- Indian Rupee (INR) rises as the market mood improves
- Domestic equities jump, oil falls
- US Dollar (USD) rises versus major peers after a hawkish Powell
- More Fed speakers are due
The US Dollar Indian Rupee (USD/INR) exchange rate is falling on Tuesday, paring gains from the previous session. The pair settled +0.44% higher on Monday at 76.28. At 10:00 UTC, USD/INR trades -0.19% at 75.13.
The Indian Rupee is rising as risk sentiment cautiously improves. Ukraine’s President Zelenskyy reiterated that Ukraine was willing to not proceed with its application to join NATO. This is addition to the fact that Russia avoided default on its bond payments have added to a more upbeat mood in the global financial markets.
Domestic equities are heading higher, the Sensex trades +1.2% at 57,996 whilst the Nifty 50 also trades 1.2% higher at 17,330.
Oil prices rallied 7% yesterday on fears that the EU could join the US and ban Russian oil imports. However, today, the price is easing lower which also helps to lift the Rupee.
The US Dollar is falling versus the Rupee but is gaining versus its major peers. The US Dollar Index, which measures the greenback versus a basket of major currencies trades +0.16% at the time of writing at 98.65, marking its fourth straight day of gains.
The US dollar advanced yesterday and is pushing higher today after Federal Reserve Chair Jerome Powell doubled down on his hawkish message from last week’s FOMC meeting. Powell said that he central bank was prepared to hike rates by 0.5% if that is what is needed at the next meeting.
The comments come as inflation sits at a 40 year high and after the Fed hiked interest rates by 0.25% last week, the first of a possible 7 hikes this year. If the Fed did hike by 0.5%, this would be the first time that it would do so since 2000.
Looking ahead there is no high impacting US economic data due to be released. There are some Fed speakers due which could influence the greenback.