- Indian Rupee (INR) falls after 2-days of losses
- Trump warned that China could see additional tariffs
- US Dollar (USD) is rising against its major peers
- FOMC minutes are in focus
The US Dollar Indian Rupee (USD/INR) exchange rate is rising after two days of losses. The pair fell -0.2% in the previous session, settling on Monday at 84.26. On Tuesday at 18:30 UTC, USD/INR trades +0.07% at 84.32 and trades in a range of 84.23 to 84.31.
The rupee weakened slightly on Tuesday, dragged down by weakness across its Asian peers. News that President Trump was considering a 10% tariff on top of tariffs already on China dampened the market mood. While this could just be part of a negotiation tactic by Trump, the market remains cautious.
The rejig of the MSCI global equity indexes helped the Rupee rise to a nearly three-week high; those gains were unsustainable, and the Rupee gave up most of those gains.
The US Dollar is rising across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, rose 0.28%, trading at 107.12 after losses yesterday.
The U.S. dollar is heading higher as investors digest the latest consumer sentiment data on Trump’s trade threats and look ahead to the minutes of the Federal Reserve November meeting.
President-elect Donald Trump announced that he would impose 25% trade tariffs on Canada and Mexico and a further 10% on China. These tariffs would be in retaliation for illegal immigration and drug trafficking into the country.
Meanwhile, the data shows that US consumers are finding themselves in a lighter mood as Black Friday approaches. According to the Conference Board, Consumer morale improved to 111.7, up 2.1 across the month to its highest level since January.
Attention now turns to the release of the minutes from the November FOMC meeting, at which the Fed cut interest rates by 25 basis points, in line with expectations.
The market will be watching closely for clues over the likelihood of another fed rate cut in December.
