- Indian Rupee (INR) rises for an 8th day
- China cuts its 1-year interest rate
- US Dollar (USD) falls after the Fed pauses rate hikes
- Retail sales unexpectedly rise +0.3%
The US Dollar Indian Rupee (USD/INR) exchange rate is holding steady after modest gains in the previous week. The pair rose 0.05% in the previous week, settling on Friday at 82.42. At 11:30 UTC, USD/INR trades +0.01% at 82.44 and trades in a range of 82.40 to 82.56.
The Rupee is extending gains for an eighth straight day, supported by an upbeat market mood after the PCoC ramped up policy action with a 1-year interest rate cut. China cut the rate for the first time in 10 months as the economic rebound cools.
The move came after China factory output rose 3.5% year on year, missing forecasts amid weakening domestic and foreign demand. Retail sales rose 12.7% in May, slowing from 18.4% in April.
The US Dollar is holding steady against the Rupee but falling against its major peers. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at -0.3% at the time of writing at 102.63, extending from losses from the previous two sessions.
The US dollar continues to move lower or as investors digest the latest economic data and the June Federal Reserve interest rate decision.
As expected, the Fed kept rates on hold at 5%- 5.25%, after 10 straight hikes. However, The Fed indicated that it wasn’t done with its hiking cycle and the closely watched dot plot pointed to policymakers hiking interest rates two more times before the end of the year. This would take the peak rate for this year to 5.6%, up from 5.1% previously.
The Federal Reserve also upwardly revised its growth forecast for the year to 1% and core inflation was also revised higher to 3.9%.
On the data front US retail sales unexpectedly rose by 0.3% month on month, defying expectations of a fall of -0.1%.