- Indian Rupee (INR) strengthens for 2nd straight session
- Indian domestic equity benchmarks close 1% higher
- US Dollar (USD) slips versus major peers on improved mood
- US PCE, durable goods and jobless claims in focus
The US Dollar Pakistan Rupee (USD/INR) exchange rate is sliding lower on Wednesday for a second straight session. The pair settled -0.2% lower in the previous session at 73.85. At 11:15 UTC, USD/INR trades -0.2%% at 73.68.
The Rupee is extending gains, following domestic equities higher. Indian shares pushed northwards closing over 1% higher as a rally in IT stocks helped overshadow jitters surrounding the new more infectious covid strain spreading through the UK.
Global funds have poured over $22 billion into Indian shares this year, sending indexes to all time highs, even as other markets have been falling lower. The Nifty 50 gained 11% this year, although still trails the MSCI AC Asia Pacific Index which has rallied 14% this year suggesting that the Nift could still have more room to run.
Indian stocks have attracted the largest yearly inflows since 2012 adding to the Reserve Bank of India’s woes. The central bank has been buying up the deluge of US Dollars to curb the Rupee’s gains.
The US Dollar is trending lower versus its major peers. The US Dollar Index which gauges the US Dollar versus a basket of 6 major peers trades -0.2% lower amid a slightly improved mood in the market. The reopening of the UK – French border for freight transport signals a step towards normality.
The US Dollar was shrugging off news that Trump has put into doubt the US covid rescue package. So far, President Trump has refused to sign off on the rescue package saying that the direct payments to Americans at $600 was insufficient.
Attention will now turn to US data with jobless claims, durable goods data and personal income and spending figures, to provide some impetus. These are the last major releases due before Christmas.