• Indian Rupee (INR) falls despite S&P India maintaining its credit rating
  • S&P Global Ratings forecasts growth of 6% in 2023/4
  • US Dollar (USD) rises on debt ceiling hopes
  • US Fed speakers are in focus

The US Dollar Indian Rupee (USD/INR) exchange rate is rising for a fourth straight session. The pair rose +0.17% last week, settling on Friday at 82.17. At 10:30 UTC, USD/INR trades +0.17% at 82.31 and trades in a range of 82.18 to 82.36.

The S&P Global Ratings said that the Indian economy is performing well amid challenging global economic conditions.

The agency also retained the country’s sovereign credit rating of BBB- long-term and A-3 short-term rating. The long-term outlook was retained as stable.

The S&P Global Ratings went on to say that the outlook reflects expectations that India’s sound economic fundamentals will offset the government’s weak fiscal performance. The ratings agency forecast 6% GDP growth in India in 2023/24 thanks to investments and consumer momentum driving growth over the coming years.

The US Dollar is rising against the Rupee but falling against 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 102.53, after booking gains of 1.5% last week.

The US dollar is pushing higher against its major peers on dent ceiling optimism and as investors weigh up the Federal Reserve’s next move.

Hopes are growing that President Biden and House Speaker Kevin McCarthy could reach a debt ceiling agreement sooner rather than later. News that Biden is cutting short a trip to Asia to return to the US by Sunday, has raised hopes that a deal could even be agreed by the end of the week.

On the data front, US jobless claims fell by more than expected to 242,000, down from 264,000 in the previous week. The data suggests that the labour market remains resilient.

Attention is now turning to a slew of Federal Reserve speakers, who could shed more light on whether the Federal Reserve will hike interest rates again in June. Currently, the market is pricing in a 30% probability of a rate hike at the next meeting.