- Indian Rupee (INR) falls after yesterday’s gains
- The RBI highlights the Indian economy’s resilience
- US Dollar (USD) rises versus major peers
- Fed Chair to testify again shortly
The US dollar-to-Indian rupee (USD/INR) exchange rate is rising after steep losses yesterday. The pair fell 0.73% in the previous session, settling on Monday at 85.94. At 15:30 UTC, USD/INR trades 0.19% higher at 86.10 and traded in a range of 85.79 to 86.14.
The Indian rupee is falling, reversing some of yesterday’s strong gains. However, the market mood remains upbeat following the Israel-Iran ceasefire, which continues to hold up.
According to the Reserve Bank of India, the Indian economy remains resilient despite shocks to the global economy from trade and geopolitical tensions.
The RBI cut its key policy rate by a larger than expected 50 basis points earlier this month and cut the reserve ratio for banks as low as inflation gave it room to focus on supporting growth amid volatile conditions.
India’s annual retail inflation slowed to 2.82% in May, its lowest level in over six years, down from 3.16% in April.
The US Dollar is rising across the board. The US Dollar Index, which measures the greenback against a basket of major currencies, is rising 0.28% to 98.12, after 3 days of losses.
The US dollar is modestly higher, recovering from a multi-year low reached in the previous session. The US dollar had fallen sharply, safe-haven bets unwound, and oil prices fell, easing inflationary pressures.
Attention is on Federal Reserve chair Jerome Powell who will testify for a second day before Congress. Yesterday, Powell reiterated the central bank’s wait-and-see mode, insisting that the Fed is in no hurry to lower rates. However, he also said that weaker-than-expected inflation or weakness in the labour market could cause the central bank to move to cut interest rates sooner.
No major data is due to be released today. Attention will be on GDP figures tomorrow and core PCE data on Friday.
