USD/INR: RBI can enforce 81.00-83.00 range without worries about trade-weighted Rupee strength – Credit Suisse
|RBI permits range of USD/INR 81-83. Economists at Credit Suisse expect the existing intervention range to continue in Q3.
RBI still tightly managing USD/INR trading range
Although exports have cooled, strong PMI data in May (manufacturing 58.7, services 61.2) showed that Indian business activity remains firmly in expansion, pointing to continued high real GDP growth of around 7%. This favorable growth outlook, along with more balanced trade flows, should keep USD/INR in a range of 81.00-83.00 during Q3.
Continued USD strength could push the RBI to revise the intervention range higher. However, given that the 83.00 level has held since Oct (when EUR/USD was below parity), we think RBI can continue to enforce this 81.00-83.00 range without worrying about trade-weighted Rupee strength.
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.