- Indian Rupee (INR) rises after losses yesterday
- Modi’s BJP party performs well in Gujarat elections
- US Dollar (USD) falls on recession fears
- US jobless claims show a cooling labour market
The US Dollar Indian Rupee (USD/INR) exchange rate is rising on Thursday, paring losses from the previous session. The pair fell -0.33% yesterday, settling at 82.20. Today, at 14:30, USD/INR trades +0.14% at 82.31, trading in a range between 82.25 to 82.46.
The rupee is trading lower with politics in focus after India’s Prime Minister Narendra Modi’s party, the BJP, looks set to win the largest majority ever achieved by a party in the elections of Gujarat. This bodes well for Modi’s possibilities for the general elections in 2024.
Oil is adding pressure who the rupee. Oil has jumped today over 3%, and West Texas Intermediate trades at $75.00 per barrel. The drop in oil prices comes as the keystone pipeline is shut down for repairs.
The US Dollar is rising versus the Rupee but falling versus its major peers The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at -0.03% at the time of writing at 105.08, extending losses from yesterday.
The US dollar came under pressure yesterday and remains under pressure today as recession fears rise. Attention it’s shifting away from inflation, and investors a starting to focus on the impact of the Federal Reserve interest rate hikes on the economy as it heads toward 2023. CEOs from the largest U.S. banks warned of a recession in 2023 and rising unemployment.
Today US jobless claims rose to 230,000 up from 225,000 in the previous week. This was in line with analysts’ forecasts. Meanwhile, continuing US jobless claims rose to the highest level since February. This suggests that those who lose their job are having more problems finding a new one. This could be considered an early sign that the labour market is cooling. A cooling labour market supports the view that the Fed could adopt a less aggressive stance toward monetary policy.