As global trade concerns and muted India Inc. profits weigh on the rupee, the USD/INR rises.
The Indian Rupee has been affected by the US-India trade deal uncertainties, FIIs' selling, and muted India Inc. Q1 earnings growth.
As traders reduce their Fed dovish bets, the US dollar trades steadily.
The Indian Rupee (INR) is down versus the US dollar (USD) at the beginning of the week. The Indian Rupee underperforms due to a number of factors, including the lack of confirmation of a trade agreement between the US and India, President Donald Trump's repeated threat of tariffs on the BRICS, the muted start of the Q1FY26 earnings season, and significant selling by Foreign Institutional Investors (FIIs) thus far this month. The USD/INR reaches a new four-week high to close to 86.50.
US President Trump has said Washington is nearing a trade agreement with India on multiple occasions. In preparation for the upcoming round of trade negotiations, India's team led by Chief Trade Negotiator Rajesh Agrawal also left Washington last week. Investors are becoming anxious as a result of both economies' delayed confirmation of trade.
On Friday, Trump once again threatened to put 10% tariffs on goods from BRICS countries for their support of what he described as "anti-American" policies. According to Reuters, Trump stressed the importance of "preserving the US Dollar's reserve status" and cautioned that Washington could not permit anyone to "play games with us."
On the home front, Indian bourses have been affected by indications of a slowdown in the early Q1 results trend. Major corporations have so far reported slow Net Interest Margins (NIMs) and little profit growth in their quarterly reports. Reliance, an oil-to-telecom company, reported excellent earnings this quarter, but a one-time rise boosted them. In Monday's session, the share has dropped more than 2%. On the other hand, the Nifty50 has increased 80 points to close to 25,050 due to strong financial companies.
India Inc.'s modest revenue growth to far seems to have caused foreign portfolio investors (FPIs) to liquidate sizable holdings in July. On Friday, FIIs purchased shares valued at RS. 374.4 crore, but they have since sold shares totaling Rs. 16,955.75 crore.
Today's Indian Rupee Price
Market movers for daily digest: In relation to the US dollar, the Indian rupee hits a new four-week low.
During Monday's European session, the Indian Rupee is trading down versus the US dollar. Following a drop in trader expectations in favor of interest rate cuts by the Federal Reserve (Fed) during the monetary policy meeting in September, the USD is trading largely unchanged.
The US Dollar Index (DXY), which measures the value of the US dollar relative to six major currencies, is currently trading steadily at 98.50, near a four-week high of approximately 99.00.
The likelihood that the Fed would lower interest rates at its September meeting has decreased from about 70% one month ago to 58.5%, according to the CME FedWatch tool. Following the release of the June US Consumer Price Index (CPI) data, which revealed that prices of mostly imported goods have gone up since President Donald Trump imposed sectoral tariffs, traders reduced their dovish bets on the Fed.
Market analysts have cautioned that since Trump's so-called "reciprocal tariffs," which go into force on August 1, have not yet been absorbed by the economy, inflationary pressures may pick up speed.
The idea that tariffs have a "one-time impact" on prices is undermined by the constant "drip-drip-" of new tariff announcements, according to Chicago Federal Reserve Bank President Austan Goolsbee, who has advised the central bank to do more to evaluate the need for any adjustment in the current monetary policy stance, according to Reuters.
The preliminary private Composite Purchasing Managers’ Index (PMI) data for July, which is scheduled to be announced on Thursday, will have an impact on the US dollar and the Indian rupee this week.
Technical Analysis: The USD/INR exchange rate closes to 86.50
At start on Monday, the USD/INR reaches its highest level in four weeks, close to 86.50, continuing its three-day winning streak. The 20-day Exponential Moving Average (EMA) is sloping upward at 86.00, indicating a positive short-term trend for the pair.
The Relative Strength Index (RSI) for the 14-day period surges to around 60.00. If the RSI rises above that level, new bullish momentum would appear.
The 50-day EMA close to 85.85 will serve as crucial support for the major if we look downward. The June 23 high, which is close to 87.00, will represent a crucial obstacle for the pair on the upside.
The Indian Rupee has been affected by the US-India trade deal uncertainties, FIIs' selling, and muted India Inc. Q1 earnings growth.
As traders reduce their Fed dovish bets, the US dollar trades steadily.
The Indian Rupee (INR) is down versus the US dollar (USD) at the beginning of the week. The Indian Rupee underperforms due to a number of factors, including the lack of confirmation of a trade agreement between the US and India, President Donald Trump's repeated threat of tariffs on the BRICS, the muted start of the Q1FY26 earnings season, and significant selling by Foreign Institutional Investors (FIIs) thus far this month. The USD/INR reaches a new four-week high to close to 86.50.
US President Trump has said Washington is nearing a trade agreement with India on multiple occasions. In preparation for the upcoming round of trade negotiations, India's team led by Chief Trade Negotiator Rajesh Agrawal also left Washington last week. Investors are becoming anxious as a result of both economies' delayed confirmation of trade.
On Friday, Trump once again threatened to put 10% tariffs on goods from BRICS countries for their support of what he described as "anti-American" policies. According to Reuters, Trump stressed the importance of "preserving the US Dollar's reserve status" and cautioned that Washington could not permit anyone to "play games with us."
On the home front, Indian bourses have been affected by indications of a slowdown in the early Q1 results trend. Major corporations have so far reported slow Net Interest Margins (NIMs) and little profit growth in their quarterly reports. Reliance, an oil-to-telecom company, reported excellent earnings this quarter, but a one-time rise boosted them. In Monday's session, the share has dropped more than 2%. On the other hand, the Nifty50 has increased 80 points to close to 25,050 due to strong financial companies.
India Inc.'s modest revenue growth to far seems to have caused foreign portfolio investors (FPIs) to liquidate sizable holdings in July. On Friday, FIIs purchased shares valued at RS. 374.4 crore, but they have since sold shares totaling Rs. 16,955.75 crore.
Today's Indian Rupee Price
Market movers for daily digest: In relation to the US dollar, the Indian rupee hits a new four-week low.
During Monday's European session, the Indian Rupee is trading down versus the US dollar. Following a drop in trader expectations in favor of interest rate cuts by the Federal Reserve (Fed) during the monetary policy meeting in September, the USD is trading largely unchanged.
The US Dollar Index (DXY), which measures the value of the US dollar relative to six major currencies, is currently trading steadily at 98.50, near a four-week high of approximately 99.00.
The likelihood that the Fed would lower interest rates at its September meeting has decreased from about 70% one month ago to 58.5%, according to the CME FedWatch tool. Following the release of the June US Consumer Price Index (CPI) data, which revealed that prices of mostly imported goods have gone up since President Donald Trump imposed sectoral tariffs, traders reduced their dovish bets on the Fed.
Market analysts have cautioned that since Trump's so-called "reciprocal tariffs," which go into force on August 1, have not yet been absorbed by the economy, inflationary pressures may pick up speed.
The idea that tariffs have a "one-time impact" on prices is undermined by the constant "drip-drip-" of new tariff announcements, according to Chicago Federal Reserve Bank President Austan Goolsbee, who has advised the central bank to do more to evaluate the need for any adjustment in the current monetary policy stance, according to Reuters.
The preliminary private Composite Purchasing Managers’ Index (PMI) data for July, which is scheduled to be announced on Thursday, will have an impact on the US dollar and the Indian rupee this week.
Technical Analysis: The USD/INR exchange rate closes to 86.50
At start on Monday, the USD/INR reaches its highest level in four weeks, close to 86.50, continuing its three-day winning streak. The 20-day Exponential Moving Average (EMA) is sloping upward at 86.00, indicating a positive short-term trend for the pair.
The Relative Strength Index (RSI) for the 14-day period surges to around 60.00. If the RSI rises above that level, new bullish momentum would appear.
The 50-day EMA close to 85.85 will serve as crucial support for the major if we look downward. The June 23 high, which is close to 87.00, will represent a crucial obstacle for the pair on the upside.
