USD/INR is increasing on Friday, though larger timeframes show that the pair has been undecided since the start of the month. Currently, one US dollar buys 71.385 Indian rupees, up 0.09% as of 9:55 AM UTC. The pair has formed a symmetrical triangle and is about to break it either above the upper line or below the bottom line.
USD and INR bearish against other majors like JPY and CAD
The rupee continues to struggle amid India’s economic slowdown, while the greenback is under pressure as investors weigh the potential impact of the coronavirus outbreak on the global economic growth.
Indian finance minister Nirmala Sitharaman said earlier today that if needed, the government would implement more measures beyond those stipulated in the Union Budget 2020-21. The minister held a speech at a session on “Budget and Beyond” with executives from asset managers, tax consultancy, wealth advisory, and other firms. She said that Budget 2020-21 implied a positive impact on equity, foreign exchange, and bond markets.
“If more has to be done beyond the Budget 2020, we are willing to do that,” Sitharaman stated at the event.
On February 1, the government presented the main steps of the Union Budget to boost economic activity. Its responsibility to support the economy has increased, given that the Reserve Bank of India (RBI) has less room to ease the monetary policy because of the wild inflation.
Yesterday, we reported that India’s retail inflation had surged 7.59% in January, which is the highest level in six years.
Earlier today, the country’s commerce and industry ministry reported that wholesale inflation had accelerated to 3.1% last month, driven by fuel and power prices. Manufactured products also increased. In December, wholesale price inflation was 2.59%.
The US also reported on its inflation figures yesterday, with core consumer prices index rising 0.2% in January. However, the US doesn’t face stagflation threats, as its economy has been improving in the last few months, while the inflation figure maintains within the Fed’s 2% target.