• Indian Rupee (INR) falls tracking equities lower
  • RBI minutes flag inflation risks
  • US Dollar (USD) rises ahead of Powell’s speech
  • Michigan consumer confidence data due

The US Dollar Indian Rupee (USD/INR) exchange rate is rising for a second straight day. The pair settled +0.09% in the previous session, settling on Thursday at 83.258. At 12:30 UTC, USD/INR trades +0.09% at 82.65 and trades in a range of 82.57 to 83.70.

The Rupee trades under pressure against a stronger USD and as domestic equities slide. Indian shares closed lower on Friday, pulled down by losses across the sectors after the minutes of the latest Reserve Bank of India meeting flagged near-term inflation risks.

The Nifty 50 closed 0.63% lower, marking the fifth straight weekly decline. The Sensex fell -0.56%.

Separately analysts believe that economic growth likely accelerated to 7.7% in the April to June quarter, the fastest pace of annual growth in a year, thanks to a strong service sector growth, robust demand and increased capital expenditure by the Government.

The US Dollar is rising across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at +0.09% at the time of writing at 104.08, extending gains from yesterday.

The US dollar has risen to a 3-month high ahead of a speech by Federal Reserve Chair Jerome Powell later today at the Federal Reserve’s Jackson Hole Central Bankers forum. Powell is not expected to claim victory in the fight against inflation. Instead, he is expected to reiterate the Fed’s commitment to bringing inflation back to the target 2% level. He is also likely to leave the door open for additional hikes above the current 5.25%-5.5% if necessary.

Powell’s speech comes after several Fed officials spoke yesterday. While Fed officials appeared to agree that the end to rate hikes is nearing, there was a lack of consensus on how close it was.

Boston Fed President Susan Collins and St Louis Fed President James Bullard said that more hikes may be needed in order to bring inflation down.

In addition to Fed Chair Powell, US Michigan consumer confidence data is due.