- Indian Rupee (INR) falls for a third day
- RBI 2-day meeting begins today
- US Dollar (USD) falls versus its major peers
- US ISM services & ADP payroll data is due
The US Dollar Indian Rupee (USD/INR) exchange rate is rising for a third straight day. The pair rose +0.05% in the previous session, settling on Tuesday at 83.23. At 11:30 UTC, USD/INR trades +0.04% at 83.25 and trades in a range of 83.18 to 83.27.
The Rupee is edging lower as investors as the Reserve Bank of India’s 2-day Monetary Policy Committee begins today. The central bank is widely expected to keep its repo rate unchanged at 6.5% at the conclusion of the meeting on Friday.
The meeting comes as annual retail inflation in August eased to 6.83%, down from 7.44% in July a 15-month high, but still remains well above the central bank’s 2% to 6% comfort band.
The US Dollar is rising versus the Rupee but falling against its major peers. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades -0.2% at the time of writing at 106.79, snapping a two-day winning run.
The US dollar is pausing for breath after rallying to a fresh 10-month high. Strong data and hawkish Federal Reserve commentary lifted U.S. treasury yields to a 16-year high amid rising bets that the Fed will keep interest rates higher for longer.
Attention is now turning to US ADP private payroll figures, which are expected to show that job creation in the private sector eased slightly to 253,000 in September down from 177,000 in August. ADP nonfarm employment figures can influence the Fed rate hike bets. Higher-than-expected job creation could support wage growth, consumption, and a more hawkish path for the Federal Reserve’s interest rates.
The data comes after jolts job opening figures yesterday unexpectedly jumped to 9.64 million, well ahead of the 8.8 million expected and highlighting strength in the US labour market despite the fed’s aggressive rate hiking cycle.
In addition to the jobs, attention will also be on the ISM services PMI, which is expected to ease slightly to 53.6, down from 54.1, whereby the level 50 separates expansion from contraction.
