June 7, 2024
New Delhi, India
Daily Currency Market Analysis
USDINR
The Indian Rupee traded in the range of 83.26 to 83.62, closing stronger due to dollar sales from foreign banks and potential intervention by the Reserve Bank of India (RBI). Despite the strengthening rupee, the HSBC India Services PMI was revised lower to 60.4 in May 2024 from the preliminary estimate of 61.4, and the Composite PMI also fell to 60.5 from an initial 61.7, indicating a slight slowdown in overall business activity.
EURINR
The Euro traded between 90.43 and 90.85, maintaining stability ahead of the European Central Bank (ECB) monetary policy decision. The annual core inflation rate in the Euro Area edged up to 2.9% in May 2024, slightly above market forecasts of 2.8%, while the overall annual inflation rate rose to 2.6%, marking the first increase in five months. These figures add complexity to the ECB’s policy deliberations.
GBPINR
The British Pound surged due to a weaker dollar, influenced by softer US inflation data that bolstered expectations of a Federal Reserve rate cut in September. Despite this, GBP remained within range as UK services activity showed signs of slowing down. The S&P Global UK Composite PMI dropped to 53.0 in May 2024 from April’s one-year high of 54.1. Meanwhile, UK retail sales rose 0.4% year-on-year in May, reversing a 4.4% decline in April, indicating mixed economic signals.
JPYINR
The Japanese Yen traded between 53.11 and 53.63, weakening as real wages in Japan fell for the 25th consecutive month in April. However, the au Jibun Bank Japan Services PMI was revised higher to 53.8 in May 2024 from a preliminary figure of 53.6, and the Composite PMI was also revised up to 52.6 from 52.4, showing some resilience in the services sector. Despite these positive revisions, the persistent decline in wages remains a concern for the Japanese economy.
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