USD/INR Price News: Rupee stays depressed around 77.50 on Indian stocks gloom
|- USD/INR snaps two-day downtrend, stays inside short-term trading range below 78.00.
- Indian equities remain downbeat tracking global clues and firmer oil prices.
- Reuters poll suggests the first annual decline in Indian stocks in seven years.
- FOMC Minutes, US Durable Goods Orders eyed for fresh impulse.
USD/INR pares the first daily gains in three around 77.55 as Indian markets open for Wednesday’s trading.
The Indian rupee (INR) managed to cheer the US dollar weakness during the last two days but the latest rebound of the greenback joins pessimism surrounding the Indian stocks to weigh on the pair prices.
It’s worth noting that the US Dollar Index (DXY) rises 0.21% intraday while bouncing off a four-week low to regain the 102.00 threshold. The DXY rebound could be linked to the risk-negative headlines from China and South Korea, as well as the market’s preparations for the US Durable Goods Orders for April, expected 0.6% versus 1.1% prior, as well as the Federal Open Market Committee (FOMC) Minutes.
On the other hand, a Reuters poll mentioned that India's equity markets will mark their first annual decline in seven years in 2022 as higher interest rates and weakening growth prospects reduce the chances of a quick rebound from this year's already sharp drop. The justification for the same said, “Soaring inflation in India and around the world, with frayed supply chains made worse by Russia's invasion of Ukraine, has pushed most central banks to begin raising interest rates, triggering hefty outflows from risky assets.” It should be observed that India’s benchmark equity index BSE Sensex drops 7.0% during 2022.
That said, mixed sentiment and USD recovery could keep the USD/INR prices firmer ahead of key US data and Fed Minutes. The upside, however, needs to be backed by firmer US data and the FOMC member’s growing concerns over inflation, which in turn pushes them towards a more than 50 bps rate hike.
Technical analysis
Unless breaking a 50-pip trading range between 77.35 and 77.85, USD/INR remains less interesting. However, the recent bearish RSI divergence hints that the pair buyers are running out of steam and hence any clear downside break of the 77.35 will be welcomed with zeal.
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.