inr-bank-notes - INR
  • Indian Rupee (INR) resilient even as risk off dominates as global covid cases rise
  • Sensex drops 800 points
  • US Dollar (USD) trades broadly higher versus major peers on safe haven flows
  • Fed speakers will move into focus amid quiet economic calendar

The US Dollar Indian Rupee (USD/INR) exchange rate is trading flat at the start of the new week, after gaining across the previous week. The pair settled on Friday +0.15% across the week at 73.53, after trading within a familiar range. At 010:45 UTC, USD/INR trades flat at 73.55. This is at the top end of the daily traded range.

The Indian Rupee is holding up amid a huge sell off in the Indian stock markets and global stock markets. The Sensex dived over 800 points after risk sentiment plunged. Countries which seemingly had control over the coronavirus outbreak were showing strong sings that they were starting to lose the battle against covid. This is particularly the case in Europe. Lockdown restrictions are tightening in major cities across Europe, which will hamper the economic recovery. As a result, investors sold out of riskier assets such as stocks, whilst boosting flows into safe havens such as the US Dollar.

Meanwhile, in India tourist sites such as the Taj Mahal, are reopening after a six-month hiatus. The re-openings comes as the Indian government seeks to get Asia’s third largest economy moving again, even as covid cases continue to rise. India has so far recorded 5.4 million coronavirus cases, making it second only to the US.

Meanwhile, the US Dollar is pushing higher versus major pees as risk aversion soars. As a result, the safe haven US Dollar is looking more attractive to many investors. Meanwhile risky stocks are falling across the board with US stock markets expected to open -2% lower.

Concerns over Congress’ failure to agree to additional fiscal stimulus could cap gains in the US Dollar.

There is no high impacting US data to distract investors today, as a result, sentiment will continue driving the pair. Some Federal Reserve policy makers are due to speak later today.

USD Index Today - last 180 days