- Indian Rupee (INR) rises after losses yesterday
- India’s service sector PMI rose to 61.6
- US Dollar (USD) falls versus major peers
- US jobless claims rise
The US Dollar Indian Rupee (USD/INR) exchange rate is falling after gains yesterday. The pair rose 0.2% in the previous session, settling on Wednesday at 83.50. At 17:00 UTC, USD/INR trades -0.17% at 83.36 and trades in a range of 83.36 to 83.51.
India’s dominant service sector grew at a faster pace in March amid strong demand and export business expanded at a record pace.
The final India services PMI rose to 61.2 in March, up from 60.6 in February, defying expectations of a fall to 60.3. This marks the 32nd straight month that the reading remained above the 50 level, which separates growth from contraction.
While upbeat domestic demand and favorable economic conditions boosted new business, exports also jumped at the quickest pace since the subcomponent was included in September 2014. As a result, firms increased hiring at the fastest pace since last August, which is good news for the economy’s outlook.
The US Dollar is falling across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at -0.17% at the time of writing at 104.22, after falling in the previous session.
The US dollar is falling as investors continue digesting Federal Reserve Jerome Powell’s comments from yesterday and after higher-than-expected US jobless claims.
US jobless claims rose by 9,000 to 221,000 in the previous week, modestly higher than the 214,000 forecasts.
The data comes after ADP private payrolls rose more than expected earlier in the week, and the employment subcomponents of the ISM services and manufacturing PMIs also posted increases.
Attention will now be on US nonfarm payroll data tomorrow, and following the lead indicators this week, we could see a slightly stronger than expected. Non-farm payroll report
Expectations are for 214,000 jobs added in March, down from 275,000 in February.
Meanwhile, the unemployment rate is expected to hold steady at 3.9%. Wage growth is expected to tick higher at 0.3% month on month up from 0.1%.
A stronger jobs report could see the market push back on expectations of a June rate cut. According to the CME Fed watch tool, the market is pricing in a 60% probability that the US central bank will start cutting rates in June.
