August 19, 2024
New Delhi, India
Daily Market Analysis
USDINR
Rupee held steady in a tight range, bolstered by dollar sales from foreign banks and the reversal of losses in Asian peers. India’s stronger-than-expected economic growth, as highlighted by the IMF’s Gita Gopinath, added to the stability. Dollar-rupee forward premiums dropped, with the 1-year implied yield down 5 basis points at 2.05%.
EURINR
The Euro declined due to weak investor confidence and a surprising drop in industrial activity. Despite the Euro Area GDP growing 0.3% in Q2, traders are betting on a 25 bps ECB rate cut in September.
GBPINR
GBP strengthened as robust UK Retail Sales reduced the likelihood of another BoE rate cut. The British economy showed significant growth in Q2, with a 0.9% year-on-year increase, and manufacturing production rose by 1.1% in June 2024.
JPYINR
The Yen depreciated against the dollar due to strong US economic data and political uncertainty in Japan, with reports that PM Fumio Kishida might not seek reelection. Japan’s economy grew by 0.8% QoQ in Q2, reversing the previous quarter’s contraction.
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