- Indian Rupee (INR) flat as covid cases remain elevated
- Indian gasoline sales rise for the first time in 6 months
- US Dollar (USD) flat despite weak retail sales
- Fed rate decision tomorrow
The US Dollar Indian Rupee (USD/INR) exchange rate is trading flat on Monday ending a 5 day losing streak. The settled -0.2% lower on Monday at 72.51. At 14:45 UTC, USD/INR trades at the same level.
India is seeing a resurgence of covid cases. New daily cases rose by 24,492. This marks the sixth straight day that new infections topped 20,000. Fears of numbers creeping higher and renewed lockdown restrictions are dragging on demand for the Rupee.
Equally signs that economic activity were picking up is helping to offset covid concerns. India state fuel retailers diesel sales rose 7.4% to 2.84 million tonnes in the first two weeks of March. Petrol sales rose 5.3% to 1.05 million tonnes in the same period.
This is the first annual rise in gasoline sales in 6 months amid covid restrictions which have curbed travel. India’s economy returned to growth in the October to December quarter.
The US Dollar trades flat versus the Rupee and versus its versus major peers. The US Dollar Index which gauges the greenback versus a basket of major peers trades unchanged on the day % at 91.85 at the time of writing.
The US Dollar trades flat, unmoved by disappointing US retail sales. Retail sales in February -2.7% month on month as US consumers pulled back sharply on retail spending in February. The fall was significant drop from January’s 5.3% uplift in sales, which were boosted by stimulus checks from the December pandemic relief package.
Whilst sales have fallen sharply this month, worse than forecast, retail sales are expected to pick up again over the coming months. A combination of the vaccine rollout reopening the economy and another round of government stimulus checks is likely to bolster sales agin.
Looking ahead the attention is now on the US Federal Reserve interest rate announcement which is due tomorrow. The Fed are not expected to move on policy but they are expected to upgrade the GDP and inflation outlook.