USD/INR Price News: Rupee bears regain 75.50 despite India’s lowest coronavirus fatalities since April
|- USD/INR reverses Friday’s pullback from late April tops.
- Market sentiment dwindles amid covid woes even as death toll recedes in India.
- Fears of third wave, expected widening of current account deficit weigh on INR.
- US off may restrict the pair moves but upside momentum seems less challenged.
USD/INR stays mildly bid around 74.52 amid Monday’s initial Indian trading session. In doing so, the Indian rupee (INR) pair challenges the previous day’s pullback from a multi-day high despite witnessing upbeat coronavirus (COVID-19) data from the Asian nation.
Early Monday, Reuters conveyed the official covid data for India, from the Health Ministry, suggesting a 39,796 daily rise in coronavirus infections, taking a total to 30.59 million. The update also mentions 723 covid-led deaths for the previous day, the lowest since April 08 and taking total fatalities to 402,278.
Also fueling the quote could be comments from Barclays and Nomura suggesting an uptick in the Current Account Deficit (CAD). Nomura expects the CAD to widen from 0.9% in FY 2021 to 1.5% of GDP in the Financial Year (FY) 2022. Barclays seems a bit optimistic on Indian economics and aims for a 1.1% CAD figure.
On the other hand, a downbeat mood and indecision over the Fed’s next moves, despite Friday’s mixed US employment data, keep the US dollar bid versus major currencies. That said, S&P 500 Futures drop 0.15% whereas stocks in Asia-Pacific also print mild losses by the press time.
Moving on, an extended holiday in the US and a light calendar elsewhere may keep USD/INR firmer around mid-72.00s. However, any surprise positives from India may not be ignored.
Technical analysis
Although the mid-April lows test USD/INR bulls around 74.50-55, even short-term sellers are less likely to take risk of entry until the quote stays beyond 10-DMA level of 74.32. Overall, USD/INR is on the way to form a rounding bottom bullish chart pattern on the daily, which in turn suggests further upside towards the yearly top surrounding 75.65.
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