June 28, 2024
New Delhi, India
Daily Currency Market Analysis
The Indian Rupee (INR) experienced a decline, primarily driven by continuous dollar demand from public sector banks. The USD/INR trading range for the day is expected to be between 83.43 and 83.81.
Key Influences on the Rupee
USDINR
Persistent Dollar Demand:
The Rupee’s decline is largely attributed to the persistent demand for the US Dollar (USD) from public sector banks. This demand has exerted downward pressure on the INR.
Federal Reserve’s Stance:
Federal Reserve officials have indicated that the central bank is not in a hurry to initiate a rate-cutting cycle, which supports the strength of the USD.
India’s Growth Forecast:
S&P Global Ratings has maintained its growth forecast for India at 6.8% for FY25, reflecting optimism about the country’s economic prospects despite current currency pressures.
EURINR
EUR/INR Trading Range:
The EUR/INR pair is trading between 89.48 and 89.70 for the day.
ECB Policy Expectations:
The Euro (EUR) is under pressure due to expectations of further policy easing by the European Central Bank (ECB). Recent data showing a decline in consumer and business morale in Germany and France has added to these expectations.
Upcoming Inflation Data:
Preliminary inflation data for major European economies, including France, Spain, and Italy, is scheduled for release on Friday, which could further influence the Euro’s performance.
GBPINR
GBP/INR Trading Range:
The GBP/INR pair is trading between 105.76 and 106.04 for the day.
Wage Growth Concerns:
The British Pound (GBP) has steadied as concerns over policy divergence have intensified due to strong wage growth in the UK. High wage inflation is preventing Bank of England (BoE) policymakers from committing to interest rate cuts.
Political Uncertainty:
Uncertainty surrounding the UK’s upcoming parliamentary elections is also contributing to the cautious sentiment towards the Pound.
JPYINR
JPY/INR Trading Range:
The JPY/INR pair is trading between 52.45 and 52.65 for the day.
Investor Caution:
The Japanese Yen (JPY) has depreciated as investors turned cautious ahead of the release of U.S. inflation data.
Government Response:
A Japanese official stated that the country will respond appropriately to excessive volatility in the Yen, which may provide some support to the currency.
Economic Data:
The au Jibun Bank Japan Services PMI dropped to 49.8 in June 2024 from 53.8 in April, indicating a contraction in the services sector, which has further weighed on the Yen.
Disclaimer:
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