- USD/INR registers three-day losing streak.
- The USD bounces off ahead of the FOMC, trade war fears prevail.
- Fed is widely anticipated to stand pat, rate outlook for 2020, Powell’s speech in focus.
With the USD/INR pair sellers catching a breath around five weeks’ low, the quote seesaws near 70.84 amid initial Indian market trading on Wednesday.
The pair has recently been on the fall as the Reserve Bank of India’s (RBI) surprise hold pushed back calls of further rate cuts from the Asian central bank. Market reports of increased corporate inflows should have contributed to the pair’s declines. Even so, doubts surrounding the Indian economic growth, fiscal slippages and inflation numbers prevail.
Recently, the Asian Development Bank (ADB) cuts its growth view for China and other developing economies of Asia while citing trade war fears as the key catalyst. The United States (US) and China have been at loggerheads over the phase-one deal since long but the nearness to December 15 US tariff deadlines arouses market fears of the full-fledged trade war.
As per the latest communication from the White House adviser Peter Navarro, it is up to the Chinese as to whether to get a deal.
Risk tone stays heavy ahead of the key events that start with the US Federal Reserve’s (Fed) monetary policy meeting. The US 10-year treasury yields seesaw near 1.83% while India’s BSE SENSEX marks near 0.40% gains to 40,400.
Moving on, global investors will now await the Fed’s monetary policy decision ahead of the United Kingdom’s (UK) December 12 election and the US tariff deadline on China. While the Federal Open Market Committee (FOMC) is likely to snap its three consecutive rate cuts, rate signals for 2020 and Chairman Jerome Powell’s press conference will be the key to watch.
Technical Analysis
An upward sloping trend line since late-September, around 70.63/65 could trigger the pair’s near-term recovery. Though, buyers will remain skeptical unless the quote rises past-November 27 low near 71.23.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
GBP/USD remains on the defensive below 1.2450 ahead of UK Retail Sales data
GBP/USD remains on the defensive near 1.2430 during the early Asian session on Friday. The downtick of the major pair is backed by the stronger US Dollar as the strong US economic data and hawkish remarks from the Fed officials have triggered the speculation that the US central bank will delay interest rate cuts to September.
EUR/USD extends its downside below 1.0650 on hawkish Fed remarks
The EUR/USD extends its downside around 1.0640 after retreating from weekly peaks of 1.0690 on Friday. The hawkish comments from Federal Reserve officials provide some support to the US Dollar.
Gold: Middle East war fears spark fresh XAU/USD rally, will it sustain?
Gold price is trading close to $2,400 early Friday, reversing from a fresh five-day high reached at $2,418 earlier in the Asian session. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row.
Bitcoin Price Outlook: All eyes on BTC as CNN calls halving the ‘World Cup for Bitcoin’
Bitcoin price remains the focus of traders and investors ahead of the halving, which is an important event expected to kick off the next bull market. Amid conflicting forecasts from analysts, an international media site has lauded the halving and what it means for the industry.
Israel vs. Iran: Fear of escalation grips risk markets
Recent reports of an Israeli aerial bombardment targeting a key nuclear facility in central Isfahan have sparked a significant shift out of risk assets and into safe-haven investments.