• Indian Rupee (INR) rises for a fourth day
  • Profit-taking pulled equities from record high
  • US Dollar (USD) falls against its major peers
  • US inflation data is due tomorrow

The US Dollar Indian Rupee (USD/INR) exchange rate is falling for a fourth straight day. The pair fell 0.03% in the previous session, settling on Monday at 83.27. At 17:00 UTC, USD/INR trades -0.09% at 83.20 and trades in a range of 83.17 to 83.34.

The Indian Rupee is rising despite a lower close in equities, as profit-taking pulled the benchmark index off record highs.

Indian shares reached a new record high, bringing the total market capitalization of companies on the National Stock Exchange to over ₹4 trillion.

Today, the Nifty 50 and Sensex closed lower due to profit-taking. However, the market remains upbeat ahead of the earnings season. Optimism of political continuity ahead of India’s general election later this month is also supporting equities.

Since early December, when Prime Minister Narendra Modi’s party won key state elections, the Nifty 50 has rallied 13%.

The US Dollar is falling against the Rupee but is steady against major peers. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at +0.01% at the time of writing at 104.11 after losses in the previous session.

The U.S. dollar is steady on a quiet day on the US economic calendar. Investors are looking cautiously ahead to tomorrow’s release of inflation data.

Inflation is expected to rise 3.4% year over year in March, up from 3.2% in February. Meanwhile, core inflation, which excludes volatile items such as food and fuel, is expected to reach 3.7% year on year, down from 3.8%.

The data comes after hotter-than-expected U.S. jobs data on Friday and then after Federal Reserve rate cut expectations for this year are lowered. Hotter-than-expected inflation data could raise questions over the Federal Reserve’s ability to cut interest rates the three times this year that it signaled at its March FOMC meeting.

In addition to inflation data, the minutes from the Federal Reserve’s March meeting will also be released and scrutinized for any further clues about the timing of the first Fed rate cut on the scale that the Fed intends to cut.