- Indian Rupee is falling for a third consecutive day
- US dollar broad-based strength
- India manufacturing sector making headway toward stagnation
- NIFTY 50 retreats from all-time high
- Market participants eyeing RBI interest rate decision
Indian Rupee is falling for a third consecutive day following a notable loss of growth momentum in the manufacturing sector. At the foreign exchange market, the value of the Rupee depreciated by 38 paise settling down 0.39% at 72.51 against the US dollar. However, the USD/INR exchange rate was seen trading on Wednesday within a trading range of 72.81 and 73.29.
Hit hard by the Covid-19 crisis, India’s manufacturing sector observed the slowest rate of growth in 10 months. The latest figures from IHS Markit India Manufacturing Purchasing Managers’ Index (PMI) moved down from 55.5 in April to 50.8 in May.
Moving on, the momentum behind the USD to INR pair may slow down in the absence of new catalysts. Market participants are now eyeing Friday’s US unemployment data and the RBI interest rate decision which can provide more clues for the USD/INR exchange rate.
The dollar index, which gauges the greenback’s strength against a basket of major currencies, settled up 0.06% at 89.92.
Elsewhere, according to the National Stock Exchange of India, foreign institutional investors were net sellers in the local equity market worth Rs 450 crore on Tuesday. The domestic benchmark equity index NIFTY 50 was seen trading within a tight range of 15,597 and 15,459 on Wednesday’s trading session.
The Indian 10-year government bond yield was seen settling at 6.014 down 0.18%.
Currently, one US dollar buys 73.10 rupees, up 0.39% as of 11:33 PM UTC.
