- Indian Rupee (INR) falls for a 3rd day
- Reserve Bank of India meeting this week
- US Dollar (USD) rises on safe-haven flows
- US ISM service PMI stalled in May
The US Dollar Indian Rupee (USD/INR) exchange rate is rising for a third straight day. The pair rose 0.15% yesterday, settling on Monday at 82.52. At 16:30 UTC, USD/INR trades +0.01% at 82.53 and trades in a range of 82.49 to 82.65.
The Indian Rupee is weakening in recent sessions, and the Indian stock market closed little changed on Tuesday as investors look ahead to the Reserve Bank of India rate decision later this week.
Recent macroeconomic data has bolstered expectations that the central bank will pause its rate hiking cycle this month.
Separately oil prices were offering support to the Rupee. Oil prices fell as investors fretted over the growth worries, which hurt the economic outlook and the demand outlook for oil. West Texas Intermediate trades -1% at the time of writing.
The US Dollar is falling across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades +0.16% at the time of writing at 104.17, after trading flat in the previous session.
The US dollar is moving higher in a relatively quiet session, supported to some degree by a level of safe haven flows as U S equities edge lower.
Investors are continuing to digest service sector PMI data from yesterday, which showed that the dominant sector in the economy almost stalled in May. New orders fell, and input prices also tumbled. However, the data supports fears that the US could be heading for a recession.
With little data in focus this week and Federal Reserve speakers in the blackout period, attention is turning to the Federal Reserve interest rate decision next week. The market is growing increasingly convinced that the Fed could pause its rate hike cycle this month but look to hike rates again in the summer.