- Indian Rupee weakened in Asian trading on Thursday.
- Higher crude oil prices weigh on the NRI; rising bets on US rate cuts and dovish Fed outlook could limit downside.
- Investors are awaiting weekly US initial jobless claims and the Philadelphia Fed manufacturing index, due on Thursday.
The Indian Rupee (INR) is attracting some sellers on Thursday despite a weaker US Dollar (USD). The prolonged rally in crude oil prices is putting some pressure on the INR as India is the world’s third-largest oil consumer. However, the local currency’s downside could be limited as rising odds of a September rate cut by the US Federal Reserve (Fed) could weigh on the Dollar and push US bond yields lower.
Later on Thursday, investors will monitor the weekly initial jobless claims and the Philadelphia Fed manufacturing index. Additionally, a speech by Fed’s Lorie Logan is scheduled. Dovish comments from Fed officials could continue to undermine the USD in the near term.
Daily Market Wrap: Indian Rupee Extends Decline Amid Global Factors
- The International Monetary Fund (IMF) on Tuesday raised its economic forecasts for this year for China, India and Europe. India’s economy is expected to grow 7 percent from the 6.8 percent projected by the IMF in April, due to higher consumer spending in rural areas.
- Fed Governor Christopher Waller said Wednesday that the U.S. central bank is “getting closer” to cutting interest rates because of improved inflation trajectory and a more balanced labor market.
- Richmond Fed President Thomas Barkin said he is “very encouraged” that the decline in inflation has begun to broaden and would like to see it continue.
- U.S. building permits rose 3.4% to 1.446 million in June from 1.399 million in May, while housing starts for the same period rose 3.0% to 1.353 million from 1.314 million.
- U.S. industrial production rose 0.6% on the month in June from the previous reading of 1.0%, beating estimates for a 0.3% increase.
Technical Analysis: USD/INR remains in consolidation mode in the short term
The Indian Rupee is trading lower on the day. The trend for the USD/INR pair seems to be bullish as the pair makes higher highs and higher lows. Moreover, the USD/INR is holding above the key 100-day exponential moving average (EMA) on the daily chart. The 14-day Relative Strength Index (RSI) is pointing higher above 57.35, suggesting that more upside could be on the horizon.
In the short term, the pair has remained confined within its one-month trading range since March 21.
A decisive break above the upper limit of the trading range at 83.65 will pave the way towards the all-time high of 83.75. Further north, the next hurdle to watch is the psychological level of 84.00.
On the other hand, the initial downside target will emerge near the 100-day EMA at 83.38. Extended losses will see a drop to the lower limit of the trading range and the round figure at 83.00, followed by 82.82, a low of January 12.
US Dollar Price Today
The table below shows the percentage change of the US Dollar (USD) against the major currencies listed today. The US Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | 0.04% | 0.03% | 0.00% | -0.12% | 0.40% | 0.00% | 0.22% | |
| EUR | -0.03% | -0.01% | -0.03% | -0.16% | 0.38% | -0.04% | 0.17% | |
| GBP | -0.02% | 0.01% | -0.02% | -0.15% | 0.37% | -0.02% | 0.20% | |
| CAD | 0.00% | 0.04% | 0.03% | -0.13% | 0.39% | 0.00% | 0.22% | |
| AUD | 0.14% | 0.17% | 0.15% | 0.13% | 0.54% | 0.12% | 0.34% | |
| JPY | -0.39% | -0.37% | -0.40% | -0.41% | -0.53% | -0.43% | -0.19% | |
| NZD | 0.00% | 0.04% | 0.03% | 0.01% | -0.12% | 0.42% | 0.21% | |
| CHF | -0.23% | -0.17% | -0.18% | -0.21% | -0.34% | 0.20% | -0.21% |
The heatmap shows the percentage changes of the major currencies relative to each other. The base currency is chosen from the left column, while the quoted currency is chosen from the top row. For example, if you choose the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change shown in the box will represent EUR (base)/JPY (quoted).
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
