- Indian Rupee (INR) under pressure as covid cases hit new record
- Indian domestic equities slump
- US Dollar (USD) boosted by blowout jobs report
- 916,000 new jobs were added in March vs 647,000 expected
The US Dollar Indian Rupee (USD/INR) exchange rate is slipping mildly lower on Monday consolidating after strong gains across the previous week. The pair rallied 1.05% across last week settling Friday at 73.37. At 11:30 UTC, USD/INR trades -0.04% at 73.33.
The Rupee came under pressure last week and the Indian stock market slumped today nearly 1400 points amid growing concerns over the resurgence of covid in the county. Indian covid cases surpassed 100,000 new daily infections for the first time ever. Some states are imposing fresh lockdown restrictions, sparking concerns for the country’s economic recovery.
The benchmark Sensex fell almost 1400 points and the blue chip Nifty 50 closed -1.5%.
Currently there are no signs of an economic slowdown. Macro data such as GST collection and auto sales for March has both indicated strong growth and a solid economic rebound. However, fears are rising on where the Indian economy goes from here and how the covid picture pans out from here.
The US Dollar strengthened versus the Indian Rupee last week and strengthened versus its major peers. The US Dollar Index which measures the greenback versus its major peers gained +0.28% across last week, its third straight week of gains.
The US Dollar has been supported by expectations of a strong economic recovery in America. The vaccination programme has accelerated significantly, and the economy is reopening.
Expectations of a strong economic rebound was confirmed by blowout US non-farm payroll numbers at the end of last week. The US jobs reports revealed that 916,000 jobs were added in the US in March, the biggest gain since last August and well ahead of the 647,000 analysts had forecast. February’s jobs report was also revised higher to 468,000 up from 379,000.
The unemployment rate fell to 6% down from 6.2% in February, adding to the good news.