inr-bank-notes - INR
  • Indian Rupee (INR) falls after losses last week
  • Indian domestic equities hit a record high
  • US Dollar (USD) rises amid quiet trade on President’s Day holiday
  • FOMC minutes in focus this week

The US Dollar Indian Rupee (USD/INR) exchange rate was inching higher after modest gains last week. The pair rose +0.02% in the previous week, settling on Friday at 83.01. At 16:00 UTC, USD/INR trades +0.05% at 83.03 and trades in a range of 82.95 to 83.01.

The Indian Rupee is holding steady despite domestic equities rising to a record high for 6th time in 2024 and for a fifth straight session led by financials and energy stocks.

Both the Nifty 50 and Sensex advanced adding 2.3% each, displaying resilience to hotter US inflation data, unlike other Asian pears.

The US Dollar is rising across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at +0.07% at the time of writing at 104.37, after gains in the previous week.

The US dollar rising adding to five straight weeks of losses as investors continued to rein in. Federal Reserve rate cut bets.

Today trading volumes are light as U.S. markets are closed in observance of the Presidents Day public holiday.

Last week the greenback rose to its highest level since mid-November versus its major peers after US inflation came in stronger than expected in January. The US dollar remains supported after PPI inflation was also stronger than expected on Friday.

The data adds to the view that the Federal Reserve will not be cutting interest rates soon. According to the CME Fed watch tool the market is currently pricing in the first rate cut in June and is now pricing in 65% probability that the Fed will leave rates unchanged in May. This is up substantially from 39% just one week ago.

Looking ahead this week the main focus will be on the FOMC minutes which could provide further clues over the timing of the first rate cut.