Indian Rupee tumbles against the greenback on the currency market amid worsening market sentiment. On the interbank foreign exchange, USD/INR exchange rate settled 32 paise higher at 71.82 on Monday close. During the early Asia trading hours and after the London open, Rupee was seen quote lower around 71.52 against the US dollar recovering some of its early losses.
The market sentiment continues to deteriorate despite the “constructive discussions” held between the US President Donald Trump and China President Xi Jinping. China is doubting that a trade deal can be reached between the world’s two most powerful economies due to President Donald Trump’s unwillingness to roll back some of the tariffs imposed on China export goods.
Despite the recent slowdown in the Indian economy, Union Minister Anurag Thakur said on Monday that India is expected to be the fastest-growing economy in the world. According to the World Economic Outlook (WEO) India’s economy is expected to grow by 6.1% in 2019 and by 7% in 2020.
The domestic benchmark equity index NIFTY 50 closed on Monday in negative territory at 11884 or -0.09%. However, during early Asia trading hours NIFTY 50 gaped higher and was seen quoted at 11945. The Indian 10-year government bond yield was quoted down at 6.472 percent or -0.09%.
The dollar index, which gauges the greenback’s strength against a basket of major currencies, closed down during the first trading day of the week settling at 97.82.
On other news, the FOMC minutes scheduled on Wednesday during the New York session can give investors further clues on the last Fed interest rate cut.
USD/INR Technical Pattern
On the technical front, the USD/INR exchange rate is challenging the previous week’s high established at 72.06. During the previous trading session, the USD/INR rate found support at the 71.45 level. The market sentiment may probably continue to favor the bull side until a real shift in the macro landscape can transpire.