The Indian Rupee is once again moving lower versus the US Dollar on Wednesday. The Indian Rupee has declined in value versus the greenback for three of the past four sessions. The Rupee settled on Tuesday -0.1% at 75.71.
At 11:45 UTC, USD/INR is trading +0.2% at 75.83. This is at the upper end of the daily traded range of 75.63 – 75.93 following a record contraction in India’s service sector.
Record Decline In Indian Service Sector Data
The IHS/Markit India Services Business Activity Index slumped to 5.4 in April as the country’s lockdown measures brought the service sector to a standstill. Needless to say that this was the worst level recorded since the survey started in 2005. The index declined by over 40 points from 49.3 in March. The level 50 separates expansion from contraction.
The composite PMI Output Index, which measures both services and manufacturing output plunged to 7.2 in April, down from 50.6 in March. The data highlighting the havoc that the coronavirus crisis is wreaking on the economy and the labour market amid a historic layoff of employees
Economists at IHS/Markit suggest that the figures coming out of India are indicating an economic contraction of 15% in April. The economic damage has been deep and far reaching and is reinforcing fears of a deep recession. However, the same economists also said that there is hope that the economy has endured the worst. The situation is expected to improve as lock down measures ease.
20 Million Private Sector Jobs Lost In US?
The US Dollar is pushing higher across the board on Wednesday as President Trump pledges to continue with reopening the US economy, even if it means more Americans fall ill. During his first trip outside of Washington since the lockdown, President Trump announced that he is preparing for phase two of the US response to coronavirus.
His message comes as investors look ahead to the release of US ADP Private payroll data. Analysts are expecting a 20 million decline in private payrolls in April. It took private companies 9 years to gradually create these jobs, which have been wiped out in 1 month. A weaker than forecast reading could spark volatility in the US Dollar.
