- Indian Rupee (INR) extends gains for 4th session
- RBI could raise interest rates
- US Dollar (USD) rises versus majors
- Consumer confidence unexpectedly plummets
The US Dollar Indian Rupee (USD/INR) exchange rate is trending lower on Friday for a fourth straight day. The pair settled -0.1% lower on Thursday at 72.70. At 14:15 UTC, USD/INR trades -0.1% at 72.62.
The Rupee gained strength as headline inflation could remain above the Reserve Bank of India’s 6% target for a third straight quarter.
India’s central bank could be prompted to raise interest rates in an attempt to bring prices in check. However, higher interest rates could snuff out the fragile economic recovery in Asia’s third largest economy.
Oil is also edging lower which is offering support to the Rupee. WTI trades -0.8% after the International Energy Agency and the Organisation for Petroleum Exporting Countries both cut their forecasts for global oil consumption this year due to lockdowns particularly in Europe.
The US Dollar is trading lower versus the Indian Rupee, however it is rising versus its major peers. The US Dollar Index which measures the greenback against 6 peers is +0.2% higher at the time of writing. Even so, the DXY is still set for its first weekly loss in three on growing doubts over the strength of the US economy.
US initial jobless claims data yesterday showed that 793,000new claims last week. Analysts had forecast a rise of 757,000.
Earlier in the week Federal Reserve Chair Jerome Powell said that the US labour market remains a long way from where it needs to be whilst committed to keeping interest rates low for longer to support the economy.
US consumer confidence unexpectedly slumped to 76.2, down from 79 and well short of the 80.8 forecast.