- Indian Rupee (INR) is falling for a 2nd day
- Chinese authorities unveil a vast stimulus package
- US Dollar (USD) falls versus its major peers
- US consumer confidence tumbles
The US Dollar Indian Rupee (USD/INR) exchange rate is rising for a second straight day. The pair rose 0.05% in the previous session, settling on Monday at 83.53. At 19:00 UTC, USD/INR trades 0.23% at 83.72 and is in a range of 83.51 to 83.77.
The Rupee is falling despite news of massive Chinese stimulus that was unveiled overnight. The Chinese central bank cut the benchmark rate and unveiled support for property and stock markets in a bid to boost demand. Authorities also signaled further policy easing should it be necessary. The move comes as economists were increasingly sceptical over whether China would hit the government’s full-year growth target of 5%. China is one of India’s largest trading partners.
Meanwhile, oil prices rallied over 2% following the announcement amid expectations of an improved demand outlook in China, the world’s largest oil importer.
The US Dollar is rising against the Rupee but falling versus its major peers. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at -0.50% at the time of writing at 100.34, extending losses from last week.
The U.S. dollar is falling versus its major peers after several days of gains following weaker-than-expected U.S. consumer confidence and the Richmond Fed survey, which disappointed to the downside.
The US Conference Board’s confidence was 98.7, well below 105.6 in August. This marked the biggest one-month drop since August 2021.
Economists had predicted that consumer confidence would be 104. However, concerns over the labour market triggered a surprising fall. Factors such as reduced hours, slower payroll growth, and fewer job openings are likely to have affected sentiment, with fewer consumers now describing jobs as plentiful.
Consumer confidence is considered a leading indicator of economic health so a sharp fall could be a signal for a potential slowdown ahead.
The data comes after a very weak nonfarm payroll report in July and a more robust report in August.