USD/INR: The Indian rupee still faces headwinds ahead – MUFG

Matías Salord FXStreet

Analysts at MUFG Bank forecast the Indian rupee will weaken gradually versus the US dollar over the next months. They see USD/INR at 78.500 by the end of the second quarter and at 79.500 by year-end.

Key Quotes:

“The Indian rupee plunged to a new record low of 77.928 against the US dollar in May on the back of mounting investor concerns over both global and domestic growth and inflation. That led to a greater amount of net foreign institutional investment outflows from Indian equities to the tune of USD 4.6bn between 2nd and 25th May based on latest available data versus a net outflow of USD 3.8bn for the entire month of April.”

“The launch of India’s largest IPO in early May did little to boost the rupee, particularly in view of a lukewarm reception from foreign investors. With India’s IPO pipeline drying up amid the challenging global risk environment, inflows into India’s capital markets are expected to dwindle which would lead to greater amounts of net portfolio outflows and have a negative impact on the rupee.”

“The impact of higher oil prices is starting to be evident on India’s trade, with a wider trade deficit seen in April at USD 20.1bn from March’s USD 18.5bn. This trend is likely to persist in the year ahead, leading to wider current account deficits and adding further downward pressure on the rupee.”

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

GBP/USD stays weak below 1.3600 as USD bulls await Warsh's speech

GBP/USD is consolidating near the lower end of its weekly range, below the 1.3600 mark, during European trading hours on Thursday. The pair's downside, however, remains cushioned as traders await Fed Chair Warsh's speech on Friday for more cues about the US central bank's interest rate path before placing fresh directional bets.

EUR/USD holds range around 1.1650 as USD steadies

EUR/USD keeps its range around 1.1650 in the European session on Thursday. Hawkish ECB expectations support the pair as the US Dollar consolidates after the US PCE data-driven advance. The focus remains on Middle East developments and US Jobless Claims data.

Gold holds steady around $4,600 as traders eye Fed's Warsh for rate cues

Gold languishes near the $4,600 mark through the first half of the European session on Thursday and remains close to the weekly low it touched the previous day. The downside, however, seems limited as traders opt to wait for US Federal Reserve Chair Kevin Warsh's speech at the Jackson Hole Symposium on Friday for cues on the future policy path. The outlook, in turn, will play a key role in influencing the US Dollar price dynamics and provide some meaningful impetus to the non-yielding bullion.

Ripple eases to $1.40, Solana hits $100, DOGE capped below $0.10

Ripple (XRP) and Dogecoin (DOGE) are facing downside pressure after double-digit gains last week, while Solana (SOL) extends its rally to $100. The technical outlook for XRP, SOL, and DOGE points to potential upside as the broader market sustains a risk-on sentiment.

Jackson Hole kicks off after upside PCE surprise

In China, industrial profits rose 17.6% y/y to CNY 4.58tn in the first seven months of 2026, slowing from an 18.7% increase in January-June. The moderation follows several months of strong profit growth around 20% y/y, supported by higher producer prices and solid manufacturing activity.

Kevin Warsh’s Jackson Hole dilemma: Say too much, too little, or just enough

Kevin Warsh is preparing to deliver his first Jackson Hole speech as Federal Reserve (Fed) Chair on Friday, and expectations extend well beyond whether interest rates will be raised or left unchanged in September.