- Indian Rupee (INR) rises in risk on trade
- Pfizer reported that its vaccine is 95% effective in its final report
- US Dollar (USD) eases on safe haven outflows
- US retail sales disappointed on Tuesday
The US Dollar Indian Rupee (USD/INR) exchange rate is slipping lower on Wednesday paring gains from the previous session. The pair settled +0.1% higher on Tuesday at 74.47. At 14:15 UTC, USD/INR trades -0.3% at 74.20.
The Indian Rupee is advancing amid a risk on mood in the market. Pfizer and BioNtech say that they have now completed the final stage clinical trial of their Covid 19 vaccine. The final results showed that the vaccine had 95% efficiency, up from the previously announced 90%. The news comes just days after Moderna announced that their vaccine candidate was also 94.5% effective.
Pfizer added that it now has sufficient safety data and will apply for a licence in the US and other countries within days.
The news has boosted risk sentiment in the market as investors cheer light at the end of the covid tunnel. Demand for risker assets and currencies such as the Indian Rupee picked up, whilst demand for the safe haven US dollar has fallen.
The vaccine news comes as India’s total covid infections reaches 8.9 million on Wednesday. This is the second highest level in the world. India recorded 38,617 new cases over the past 24 hours a significant slowdown from the almost 100,000 new daily cases recorded during the peak.
Covid cases are also on the rise in the US with states tightening lockdown restrictions in order to stem the spread of the virus. Data on Tuesday showed that US consumption started to slow as covid cases started to rise again, boosting fears that tighter lockdown restrictions could de rail the US economic recovery. US retail sales rose +0.3% month on month in October versus 0.5% expected and a significant fall from September’s 1.6% increase.
There is no more high impacting US data today. Sentiment will continue to drive the US Dollar, in addition to a speech by Fed’s Williams later today.