- Indian Rupee (INR) rises for a third day
- The RBI Governor Das said focus is needed to cool inflation
- US Dollar (USD) is rising against its major peers
- US consumer confidence fell to 100
The US Dollar Indian Rupee (USD/INR) exchange rate is falling for a third straight day The pair fell 0.13% in the previous session, settling on Monday at 83.45. At 20:00 UTC, USD/INR trades -0.04% at 83.41 and is in a range of 83.50 to 83.39.
On Tuesday, the Reserve Bank of India governor, Das, said that India needs a clear focus and commitment to lower inflation to its 4% target.
Indian inflation eased to 4.75% in May, down from 4.83% in April, but is still considerably above the RBI’s medium-term goal.
RBI governor Das noted that inflation had moderated in May; however, he warned that any severe weather-related shortfall could push inflation back above 5%.
India’s economic growth remains robust and could improve further in the coming months, adding to confidence that the economy will grow by 7.2% in the current fiscal year.
The US Dollar falling against the Rupee but rising against its major peers. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades +0.15% at the time of writing at 105.63, after losses in the previous session.
The U.S. dollar is pushing higher after yesterday’s losses as investors shrug off weaker consumer confidence data and look ahead to Friday’s inflation figures.
U.S. consumer confidence fell to 100 in June, down from 102 in the previous month, amid a more muted outlook for business conditions, the jobs market, and income.
Confidence has been subdued over the past few years as consumers face the higher cost of living and elevated borrowing costs. More recently, there has been a softening in the labour market to also contend with.
According to the data, only 12.5% of consumers expect business conditions to improve over the coming six months.
While concerns about prices eased slightly this month, consumers still noted high prices for groceries.
The data comes ahead of core PCE figures on Friday the Fed’s preferred measure for inflation.
Meanwhile, Fed speakers have also been in focus, with Fed official Michelle Bowman warning that the upside risk to inflation remains and that the central bank may need to raise interest rates again in order to tame inflation.
