inr-bank-notes - INR
  • Indian Rupee (INR) rises as oil prices fall
  • Oil prices drop 4% as Shanghai enters lock down
  • US Dollar (USD) rises versus major peer, tracing yields higher
  • There is no US data due today

The US Dollar Indian Rupee (USD/INR) exchange rate is falling at the start of the week, after rising last week. The pair settled gained 0.3% across last week, settling at 76.28. At 10:30 UTC, USD/INR trades -0.1% at 76.20.

The Rupee is edging higher as oil prices decline. Oil has fallen 4% so far today on demand concerns as China sees a continued rise in COVID cases. The world’s largest importer of oil has seen Shanghai enter into a partial lockdown to prevent the spread of COVID. China continues with its zero-COVID policy and as a result part, the of the key financial city, home to 26 million people will come to a standstill.

West Texas Intermediate trades at 108.70, but still trades up 14% across March on supply worries as the Russian war continues.

Indian domestic equities trade marginally higher. The Sensex is up 0.15% at 57,450 and the Nifty 50 trades 0.13% higher.

The US Dollar is falling versus the Rupee but is rising versus its major peers. The US Dollar Index, which measures the greenback versus a basket of major currencies trades +0.43% at the time of writing at 99.21 building on gains from last week.

The US dollar rallied last week on the back of an increasingly hawkish sounding Federal Reserve. Fed officials speaking through the week expressed support of a 50 basis point rate hike in the May meeting in order to tame inflation which has surged to a 40 year high.

This week treasury yields continue to rise, lifting the greenback higher. Concerns over rising COVID cases in China is also supporting safe haven flows.

Today there is no high impacting US data. This week attention will be on US PCE the Fed’s preferred inflation gauge, in addition to the labour market report on Friday, the non-farm payroll.