- Indian Rupee (INR) advances as consumer confidence and demand increases at the start of festival season
- US Dollar (USD) trades lower across the board
- US durable goods MoM September impress at 1.9% vs 0.5% expected
The US Dollar Indian Rupee (USD/INR) exchange rate is heading lower on Tuesday after five straight sessions of gains. The pair settled on Monday +0.2% at 73.96. At 11:15 UTC, USD/INR trades -0.45% higher at 73.62.
Consumer goods demand has increased in October as festival season begin. Festival season runs from October to March and early signs are suggesting that it could help to revive India’s pandemic hit economy.
Finance Minister Nirmala, referring to the Markit PMI reports said that economic activity had risen as India emerged from lockdown restrictions and as the government put in place various measures to support the economy. The PMI data for September revealed that factory activity in India expanded at its fastest pace in over 8 years.
The festive season is providing a much needed boost to the corona ravaged consumer goods industry, with retail sales in the 10 days between Navratri to Dussehra period registering double digit growth whilst also topping last years figures indicating the revival in consumer confidence.
The US Dollar traded lower across the European session versus the Indian Rupee and its major peers. US Durable goods data dominated the US economic calendar. Durable goods orders increased for the fifth straight month in September, in the latest signal that US manufacturers are recovering from the supply chain disruptions that coronavirus and the lockdown brought with it.
Durable goods jumped 1.9% month on month in September, well ahead of the 0.4% increase recorded in August and well ahead of the 0.5% analysts had pencilled in. New orders for nondefence capital goods excluding aircrafts are considered a proxy for business investment; these jumped 1% last month, now recovering all of its pandemic related losses.
Attention will now turn towards US consumer confidence for October which is due to be released later today.
