USD/INR Price News: Aims to recapture all-time-highs at 78.50 on hawkish Fed bets
|- USD/INR is aiming to recapture its all-time highs at 78.46 as odds of a bumper rate hike by the Fed escalate.
- The Fed is committed to bringing price stability to the US economy sooner.
- Oil prices have fallen like a house of cards on escalating recession fears.
The USD/INR pair is attempting to create a base in a range of 78.20-78.25 after a mild correction from its all-time-highs at 78.46. Considering the overall bullish structure, the asset is expected to recapture its all-time highs. A hawkish guidance from Federal Reserve (Fed) chair Jerome Powell’s testimony on interest rate projections in July monetary policy has underpinned the greenback against the Indian rupee.
Fed Powell in his testimony dictated that the central bank is ‘strongly committed to bringing price stability, which clearly states that the rate hike extent announced in June could repeat in July too. The Fed has already elevated its interest rates to 1.50-1.75% after announcing the biggest rate hike of 75 basis points (bps) in the past 28 years. Despite that, the inflation rate has not portrayed any pause signals yet. What was music to the ears was that the US economy is rock solid, taking into account the resilient demand and tight labor market, which is efficient to face the headwinds of higher interest rates.
On the oil front, falling oil prices are expected to provide support to the Indian rupee in the near term. The black gold has remained in the grip of bears on advancing odds of a recession in the world economy. Demand is what matters most for the oil prices rather than the supply. One could easily identify this fact by noting the momentum of oil price rise while supply constraints due to the ban of Russia were underpinned by the current fall due to recession fears.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.