Indian Rupee Price News and Forecast: USD/INR sellers stop cheering RBI’s inaction with eyes on US jobs report
|UUSD/INR loses traction following RBI surprise hold
USD/INR is bleeding from a high of 71.6550 to a low of 71.2050 on the day so far, -0.34% at the time of writing. The main focus had been on the Reserve Bank of India keeping its key lending rate on hold in a surprise decision on Thursday.
Markets were positioning for a sixth-consecutive rate cut from the most aggressive major central bank in the world, considering a worrying slowdown in the country that prompted the central bank to sharply reduce its economic growth forecast to 5% for the year through March. However, while the RBI reiterated it would maintain an accommodative stance, the monetary policy committee unanimously voted to hold the key repo rate at 5.15% while the reverse repo rate was also held at 4.90%.
USD/INR sellers stop cheering RBI’s inaction with eyes on US jobs report
USD/INR takes the bids to 71.35 by the press time of the pre-European session on Friday. The pair earlier dropped to the lowest since November 11 on Thursday after the Reserve Bank of India (RBI) beat market forecasts by not announcing any rate cuts.
Be it Mark Mobius of Mobius Capital Partners or analysts at CLSA, not to forget Morgan Stanley, everybody was taken aback when the Indian central bank defied market consensus of another rate cut during the previous day. The bank cut down the 2019/20 growth projection from 6.1% to 5.0% while expecting an uptick in inflation readings.
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