- Indian Rupee (INR) slips after gains last week
- JPMorgan will include Indian bonds in its EM index
- US Dollar (USD) has risen for the past 10 weeks
- Fed official Neel Kashari is due to speak
The US Dollar Indian Rupee (USD/INR) exchange rate is rising after losses last week. The pair fell -0.12% in the previous week, settling on Friday at 82.97. At 10:30 UTC, USD/INR trades +0.17% at 83.10 and trades in a range of 82.97 to 83.10.
The Rupee pushed higher last week after JP Morgan announced the inclusion of Indian bonds into its emerging market index. However, those gains are proving to be short-lived, and the Rupee is losing momentum as month-end dollar demand from importers and oil companies is unlikely to keep the rupiah under pressure across this week.
Meanwhile, Indian equities are under pressure today, with IT stocks dragging on the main indices.
Indian portfolio flows have turned weaker in September as foreign investors to net sellers of Indian equities this month after six straight months of buying.
The US Dollar is rising across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades +0.05% at the time of writing at 105.64, as it extends gains into an 11th straight week.
The US dollar is pushing higher, extending gains for an 11th straight week, a winning run of this length hasn’t been seen since 2014.
The greenback is pushing higher on expectations that the Federal Reserve will keep interest rates higher for longer. Last week, the Federal Reserve left interest rates on hold but signaled to another interest rate hike this year and less easing next year.
The more hawkish stance from the Federal Reserve came after a string of stronger-than-expected U.S. economic data, which has shown that the U.S. economy is proving to be more resilient than expected. That said, US PMI data on Friday came in slightly below forecasts at 50.2 in September, down marginally from 50.5 in August.
The focus will remain on the Federal Reserve at the start of the week as Minneapolis Fed president Neel Keshari is due to speak.
Looking out across the week, Friday’s PCE data, the fed’s preferred inflation gauge will likely be the key focus.
