USD/INR sellers stop cheering RBI’s inaction with eyes on US jobs report
|- USD/INR bounces off early-November lows.
- RBI’s surprise pause in rate cut dragged the quote down the previous day.
- Markets await the key US data amid optimistic forecasts.
USD/INR takes the bids to 71.35 by the press time of the pre-European session on Friday. The pair earlier dropped to the lowest since November 11 on Thursday after the Reserve Bank of India (RBI) beat market forecasts by not announcing any rate cuts.
Be it Mark Mobius of Mobius Capital Partners or analysts at CLSA, not to forget Morgan Stanley, everybody was taken aback when the Indian central bank defied market consensus of another rate cut during the previous day. The bank cut down the 2019/20 growth projection from 6.1% to 5.0% while expecting an uptick in inflation readings.
Though, the move got largely criticized afterward on doubts over the policymakers’ expectations that the inflation will recover.
However, wait and watch mode ahead of the United States (US) November month employment data and a lack of major signals keep traders guessing.
As a result, the US 10-year treasury yields take rounds to 1.8% while S&P 500 Futures and most Asian indices keep moving around the no-change rate. India’s benchmark BSE SENSEX follows the suit with +0.21% gains to 40,875.
Today’s jobs report from the US become more important due to the upbeat forecast that contrasts the early signals like ADP data. Markets expect 180K of the headline Nonfarm Payrolls (NFP) versus 128K prior while no change is anticipated from 3.6% Unemployment Rate and 3.0% Average Hourly Earnings.
Technical Analysis
61.8% Fibonacci retracement of November month upside, near 71.20, keeps limiting the pair’s near-term declines while buyers may target 72.00 as an immediate landmark.
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