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USD/INR Price News: Indian rupee eases inside routine range above 77.00 amid indecision

  • USD/INR picks up bids to snap three-day downtrend, bounces off weekly low.
  • FOMC Minutes, RBI’s assurance to limit “runaway” INR slump challenge pair buyers.
  • Firmer oil prices, subdued sentiment and exodus of funds from Indian equities bar gate for bears.
  • US GDP, Fed’s preferred inflation gauge will be important this week, risk catalysts should be watched too.

USD/INR consolidates weekly losses around 77.55, staying inside a fortnight-long trading range surrounding 77.30-80 as traders struggle with diverse catalysts during Thursday’s Asian session.

Among them, the latest Federal Open Market Committee (FOMC) Minutes and the recently active Reserve Bank of India (RBI) seem to restrict the pair’s upside momentum. However, pessimism surrounding the Indian stock market, strong oil prices and sluggish risk appetite keep the USD/INR bulls hopeful.

That said, the recent Fed minutes mentioned that the policymakers endorsed the idea of 50 basis points (bps) rate hikes for only the next couple of meetings and raised doubts on the rate-lift trajectory past September, which in turn favored sentiment. On the other hand, the RBI recently assured investors of not allowing "runaway" INR depreciation limits USD upside, per Reuters.

On the other hand, Indian equities are on the way to posting the first yearly loss in seven as broad fears of growth and inflation push foreign investors to flee, marking the record outflow of foreign funds during the first five months of 2022.

Further, WTI crude oil prices also print mild gains around $111.00 by the press time and brace for the sixth monthly run-up. Considering India’s record deficit and heavy reliance on oil imports, firmer energy prices drown the Indian rupee (INR).

Elsewhere, comments from US Trade Representative General Counsel Greta Peisch suggesting, “Review of US-Sino tariffs is likely to take ‘months’,” becomes a fresh threat to the US-China trade relations. Previously, Beijing criticizes the US Draft Security Council resolution on North Korea and added strength to the Sino-American tensions. Also negative from China are the covid-led lockdowns that weigh on the world’s second-largest economy, also Australia’s biggest trading partner.

It’s worth noting that fears of global recession due to the Ukraine-Russia crisis, recently backed by World Bank President David Malpass also favor USD/INR prices. "Russia's war in Ukraine and its impact on food and energy prices, as well as the availability of fertilizer, could trigger a global recession," said World Bank's Malpass on Wednesday during an event hosted by the U.S. Chamber of Commerce.

Moving on, off in major European bourses join a light calendar to restrict USD/INR moves but the second reading of the US Q1 2022 GDP, the annualized figure is expected to remain unchanged at -1.4%, will be important to watch. Also crucial will be Personal Consumption Expenditure (PCE) details for April and weekly jobless claims.

Technical analysis

Even if a choppy trading range between 77.30 and 77.80 restricts short-term USD/INR moves, RSI conditions hint at the receding bullish momentum. However, sellers need to wait for a clear break below 77.30 for fresh entries. On the contrary, the 10-DMA level of 77.56 guards immediate recovery moves ahead of 77.80.

Additional important levels

Overview
Today last price77.5474
Today Daily Change0.0940
Today Daily Change %0.12%
Today daily open77.4534
 
Trends
Daily SMA2077.1606
Daily SMA5076.5404
Daily SMA10075.8242
Daily SMA20075.183
 
Levels
Previous Daily High77.6135
Previous Daily Low77.4446
Previous Weekly High78.12
Previous Weekly Low77.335
Previous Monthly High77.0715
Previous Monthly Low75.2634
Daily Fibonacci 38.2%77.5091
Daily Fibonacci 61.8%77.549
Daily Pivot Point S177.3941
Daily Pivot Point S277.3349
Daily Pivot Point S377.2252
Daily Pivot Point R177.5631
Daily Pivot Point R277.6728
Daily Pivot Point R377.732

Author

Anil Panchal

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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