• Indian Rupee (INR) is rising after being flat yesterday
  • Nifty 50 and the Sensex rise to record highs
  • US Dollar (USD) falls versus major peers
  • US retail sales data is due

The US Dollar Indian Rupee (USD/INR) exchange rate is edging lower after holding steady yesterday. The pair fell -0.01% in the previous week, settling on Monday at 82.04. At 11:30 UTC, USD/INR trades -0.03% at 82.03 and trades in a range of 81.97 to 82.06.

The Rupee is edging higher but struggles to maintain above 82.00 on likely intervention from the Reserve Bank of India. The RBI has consistently been buying US dollars when the Rupee has strengthened above 82.00.

Meanwhile, Indian equities extended gains, closing higher on Tuesday after a fourth straight day of gains. Strength in IT stocks and gains by Reliance offset weakness elsewhere.

The Nifty 50 rose 0.2%, and the Sensex gained 0.31%. Both indices rose to fresh all-time highs before retreating slightly.

Elsewhere Asian markets were under pressure amid concerns over China’s growth. Yesterday China posted disappointing Q2 growth, which resulted in several major US banks downwardly revising their growth outlook for China.

The US Dollar is falling across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at -0.13% at the time of writing at 99.72, extending losses from yesterday.

The US dollar is falling as investors anticipate that the Federal Reserve is close to ending its interest rate hiking cycle. Last week softer than expected inflation as both consumer prices and producer prices fell by more than expected, fueled bet that the Fed would raise interest rates just once more this term.

Attention will now turn to US retail sales which are expected to rise 0.5% month on month in June after rising 0.3% in May. Strong retail sales could highlight the resilience of the US consumer despite higher interest rates and as inflation cools.

An upbeat retail sales figures could boost demand for the USD, which has been under pressure in recent weeks.