USD/INR: Rupee volatility hits lowest since August 2018
|- INR volatility hits lowest since August 2018.
- Dollar recovery likely as the market seems to have overpriced rate cuts.
The Indian Rupee’s (INR) one-month ATM volatility fell to 5.125 on Tuesday, the lowest level since Aug. 9, 2018.
Notably, the volatility gauge has dropped sharply from 9.275 to 13-month lows over the last four weeks.
The USD/INR pair ended with 0.20% losses on Tuesday and is trapped in a falling wedge, as per the daily chart.
A break above the wedge resistance, currently at 69.53 would create room for a rise to recent highs above 70.50.
A breakout cannot be ruled out as markets have overpriced Fed rate cuts, as per Goldman Sachs and a broad-based US dollar could be seen if the upcoming US macro data better estimates.
It is worth noting that the 10-year US Treasury yield is now seen at 2.14%, up 10 basis points from the multi-month low of 2.05% hit on June 7.
INR's volatility
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.