During Tuesday's early European session, the Indian Rupee depreciates.
The INR is impacted by the ongoing demand for US dollars and the unchecked flight of foreign capital.
On Wednesday, the focus will be on the US and Indian CPI inflation figures.
Due to pressure from importers' high demand for US dollars (USD), the Indian Rupee (INR) continued its downward trend on Tuesday. The local currency, which has been impacted by foreign fund sales of local stocks since late September, is also under some selling pressure due to maturities in the non-deliverable forwards (NDF) market. The INR and other developing market currencies may be impacted by the uncertainty created by US President Donald Trump's tariff strategy.
However, the Reserve Bank of India's (RBI) foreign exchange intervention may minimize any severe depreciation of the native currency. Furthermore, as India is the third-largest oil user in the world, a drop in crude oil prices should help minimize the INR's losses.
The USD/INR pair will be influenced by the Greenback on Tuesday if there are no important economic data releases from the US and India. Highlights on Wednesday will be the February Consumer Price Index (CPI) inflation readings for the US and India.
Amid global forces and portfolio outflows, the Indian Rupee weakens.
A trader at a private bank stated, "As Indian corporations have begun purchasing oil from the US, the rupee depreciated due to an increase in dollar demand from oil companies."
So far this year, foreign investors have taken out about $15 billion from Indian shares, putting outflows on pace to surpass the record $17 billion seen in 2022. India's market value has dropped by $1.3 trillion as a result of the selloff.
Trump refrained from predicting whether the US would experience a recession on Sunday due to stock market apprehensions over his tariff policies on China, Canada, and Mexico.
The US Nonfarm Payrolls (NFP) increased by 151K in February compared to 125K previously (raised from 143K), which was less than anticipated. In the meantime, the unemployment rate increased slightly from 4.0% in January to 4.1% in February.
Citing uncertainties about the possible effects of Trump's proposals, Fed Chair Jerome Powell stated on Friday that the US central bank may continue to be careful in modifying its benchmark interest rate.
According to LSEG data, traders are currently pricing in 75 basis points (bps) of rate cuts from the Fed this year, with a rate drop completely priced in for June.
Longer term, the USD/INR maintains its positive stance.
Every day, the value of the Indian Rupee declines. On the daily chart, the price of the USD/INR pair is still above the important 100-day Exponential Moving Average (EMA), indicating that the bullish bias is still present. Since the 14-day Relative Strength Index (RSI) is above the midline at 60.0, the path of least resistance is upward.
The February 28 high of 87.53 is the initial upward goal for USD/INR. On the way to 88.50, potential bullish candlesticks above the aforementioned level may surge to an all-time high close to 88.00.
The low of March 6, 86.86, is the first support level in the bearish event. There might be selling pressure to 86.48, the February 21 low, and 86.14, the January 27 low, if there is any follow-through selling.
The INR is impacted by the ongoing demand for US dollars and the unchecked flight of foreign capital.
On Wednesday, the focus will be on the US and Indian CPI inflation figures.
Due to pressure from importers' high demand for US dollars (USD), the Indian Rupee (INR) continued its downward trend on Tuesday. The local currency, which has been impacted by foreign fund sales of local stocks since late September, is also under some selling pressure due to maturities in the non-deliverable forwards (NDF) market. The INR and other developing market currencies may be impacted by the uncertainty created by US President Donald Trump's tariff strategy.
However, the Reserve Bank of India's (RBI) foreign exchange intervention may minimize any severe depreciation of the native currency. Furthermore, as India is the third-largest oil user in the world, a drop in crude oil prices should help minimize the INR's losses.
The USD/INR pair will be influenced by the Greenback on Tuesday if there are no important economic data releases from the US and India. Highlights on Wednesday will be the February Consumer Price Index (CPI) inflation readings for the US and India.
Amid global forces and portfolio outflows, the Indian Rupee weakens.
A trader at a private bank stated, "As Indian corporations have begun purchasing oil from the US, the rupee depreciated due to an increase in dollar demand from oil companies."
So far this year, foreign investors have taken out about $15 billion from Indian shares, putting outflows on pace to surpass the record $17 billion seen in 2022. India's market value has dropped by $1.3 trillion as a result of the selloff.
Trump refrained from predicting whether the US would experience a recession on Sunday due to stock market apprehensions over his tariff policies on China, Canada, and Mexico.
The US Nonfarm Payrolls (NFP) increased by 151K in February compared to 125K previously (raised from 143K), which was less than anticipated. In the meantime, the unemployment rate increased slightly from 4.0% in January to 4.1% in February.
Citing uncertainties about the possible effects of Trump's proposals, Fed Chair Jerome Powell stated on Friday that the US central bank may continue to be careful in modifying its benchmark interest rate.
According to LSEG data, traders are currently pricing in 75 basis points (bps) of rate cuts from the Fed this year, with a rate drop completely priced in for June.
Longer term, the USD/INR maintains its positive stance.
Every day, the value of the Indian Rupee declines. On the daily chart, the price of the USD/INR pair is still above the important 100-day Exponential Moving Average (EMA), indicating that the bullish bias is still present. Since the 14-day Relative Strength Index (RSI) is above the midline at 60.0, the path of least resistance is upward.
The February 28 high of 87.53 is the initial upward goal for USD/INR. On the way to 88.50, potential bullish candlesticks above the aforementioned level may surge to an all-time high close to 88.00.
The low of March 6, 86.86, is the first support level in the bearish event. There might be selling pressure to 86.48, the February 21 low, and 86.14, the January 27 low, if there is any follow-through selling.
