- Indian Rupee (INR) rises after 3-das of loses
- RBI sees foreign reserve outflows
- US Dollar (USD) rises to a 2020 high versus major peers
- Trump trade & inflation boosts the USD
The US Dollar Indian Rupee (USD/INR) exchange rate fell on Friday after 3 days of gains. The pair rose 0.05% in the previous session, settling on Thursday at 84.46. On Friday, USD/INR settled down 0.06% at 84.42 and traded in a range of 84.38 to 84.47.
Pay fell across the week I made a stronger U.S. dollar, and India’s foreign exchange reserves dropped for a sixth straight week to an almost three-month low. Reserves dropped to $675.65 billion as of November 8th, according to data from the Reserve Bank of India.
The reserves fell by $6.5 billion in the reporting week, down $29.2 billion from the record high of $704.9 billion in September.
Changes to phone currency assets have been caused by the RBI’s intervention in the forex market and by the appreciation or depreciation of foreign assets held in the reserve.
The US Dollar rose across the board on Friday. The US Dollar Index, which measures the greenback versus a basket of major currencies, rose 0.02%, trading at 106.69. This marks a sixth straight day of gains as the Trump Trade continues.
The U.S. dollar booked gains on Friday and saw strong gains across the week, with the US dollar index reaching a 2024 high against its major peers.
The US dollar rose across the previous week on expectations that the Federal Reserve will cut rates or at a slower pace after Federal Reserve chair Jerome Powell said the Fed was in no rush to ease monetary policy. He cited strong growth, a resilient labor market, and inflation still above the central bank’s 2% target. I first seem to be cautious when cutting rates.
Meanwhile, data last week also supported the Fed’s adoption of a more gradual approach to rate cuts as CPI and PPI both showed an uptick in inflation.