- Indian Rupee (INR) rises as risk sentiment improves
- GDP data due tomorrow
- US Dollar (USD) steadies after Fed inspired losses on Friday
- Federal Reserve in no rush to hike rates
The US Dollar Indian Rupee (USD/INR) exchange rate is edging lower at the start of the week after steep losses in the previous week. The pair lost -1.18% last week settling at 73.47 on Friday. At 16:30 UTC, USD/INR trades -0.27% lower at 73.29.
The Indian Rupee hit a two and a half year high amid as risk sentiment improved, boosted by expectations that the US Federal Reserve will reduce monetary stimulus at a slower pace. Most emerging market currencies rallied.
On Friday the Indian government sold a higher than forecast 340 billion Rupee debt auction.
On the data from investors turned their attention to quarterly GDP data which is due to be released on Tuesday. This will give clues over the economic recovery and potentially indicate a possible timeline for the Reserve Bank of India to normalize monetary policy.
The RBI Governor Shakitikanta Das has said that the central bank won’t make any surprise moves and that a cautious approach will be adopted.
The US Dollar is trading lower across the board on Monday. The US Dollar Index, which measures the greenback versus a basket of major currencies trades -0.02% at the time of writing at 92.65 after booking steep losses across the previous week.
The US Dollar is hovering around two-week lows at the start of the week following on from Federal Reserve Chair Jerome Powell’s comments at the Jackson Hole forum which were interpreted as dovish.
The greenback experienced one of its biggest daily declines on Friday after Jerome Powell said that whilst tapering of bond purchases could start this year, the central bank was in no rush to hike interest rates.
Investors will now look ahead to Friday’s non-farm payroll report on Friday for further clues over the health of the US economy.