Indian Rupee slides more on the currency market amid trade deal uncertainties. USD/INR bullish momentum built during the last week trading session has been carried through the first trading day of the week.
The USD/INR exchange rate settled 24 paise higher at 71.39 during the first trading day. During the early Asia trading hours, Rupee was seen trading slightly higher at 71.33 against the US dollar.
Investors continue to dump the Indian Rupee on the currency market as they remain cautious over the trade dispute between the world’s two most powerful economies in the world. It appears that the US President Donald Trump and China’s Xi Jinping have some disagreements with regard to the tit-for-tat tariffs.
“We have to make the right deal for the farmers, manufacturers, for everybody. And if we don’t make that right deal, we’re not going to make a deal,” said US President Donald Trump – citing Reuters.
Investors seem more concerned about a log-term trade deal, which is the only deal that can stabilize the global economy.
The benchmark equity index NIFTY 50 came under pressure but closed the gap and posted positive gains settling at 11913. The Indian equity market and debt market will remain close today on account of Guru Nanak Jayanti.
The dollar index, which gauges the greenback’s strength against a basket of major currencies closed the first trading day on a negative note closing at 98.21.
The foreign institutional investors have invested in the Indian equity market almost Rs 932.20 crore on Monday, according to provisional exchange data.
USD/INR Technical Pattern
The USD/INR technical pattern seems to be testing the top of the range at 71.56, which may cause a pause in the bullish trend. In the long-term, the bullish trend should carry on going into the last part of the year. Year to date the Indian Rupee has already lost 2.44% of its value against the US dollar. The market expectation is for a no material change in the trend direction as the macro factors driving the Rupee weakness have not faded away.