- Indian Rupee (INR) falls for a second day
- Corporate outflows weighed on the Rupee
- US Dollar (USD) is rising against major peers
- US jobless claims rose to 243k
The US Dollar Indian Rupee (USD/INR) exchange rate is rising for a second straight day. The pair rose 0.07% in the previous session, settling on Monday at 83.58. At 19:00 UTC, USD/INR trades 0.07% at 83.54 and is in a range of 83.55 to 83.69.
The Indian rupee has settled within a whisker of its record low amid corporate outflows and as oil companies bid for dollars.
Meanwhile, attention is turning to Prime Minister Modi’s first budget after re-election, which will be unveiled next week.
Modi is expected to take steps to boost jobs and incomes as economic growth remains uneven and food prices soar.
The budget will be unveiled on July 23rd and could provide the first sign of any change in the government’s economic policies.
The US Dollar is rising across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades +0.49% at the time of writing at 104.18, marking the second day of gains.
The U.S. dollar is rising but remains near a three-month low on expectations that the Federal Reserve will cut interest rates sooner rather than later.
US jobless claims data showed that the number of Americans filing for unemployment benefits for the first time Increased by 20,000 to 243,000 in the week ending July 13th, matching the highest level since August 2023, according to data released by the Labor Department. Analysts had expected an increase to 230,000.
The increase is partly a reflection of Hurricane Beryl, as claims in Texas jumped by over 11,500 during the week, the largest increase since March 2021. However, continuing claims, which are a proxy for the number of people receiving unemployment benefits, increased by 20,000 to 1.87 million, the highest level since November 2021.
While there are a few one-off factors, broadly speaking, the trend is that claims are rising, suggesting a softening in the labour market.
The data comes as the markets price in the 100% probability that the Fed will cut interest rates in September, potentially three more times across the year.
Looking ahead, no more data will be released today. Attention will be on Federal Reserve officials Lorie Logan and Mary Daly, who are due to speak and could provide more clues about the path for interest rates.
