November 12, 2024
New Delhi, India
Overview:
USDINR:
- Trading Range: 84.38 – 84.46
The Indian Rupee weakened to a record low due to continued stock outflows and strengthening dollar expectations. State-run banks were observed selling dollars, likely on behalf of the RBI, to help curb further declines in the currency. Additionally, dollar-rupee forward premiums have declined, with the 1-year implied yield down 3 basis points at 2.19%.
EURINR:
- Trading Range: 90.92 – 91.3
The Euro strengthened as traders reacted to the Fed’s recent policy decision and monitored the political climate in Germany. Economic data showed a notable 4.2% increase in German factory orders in September, surpassing the market forecast of 1.5%. Meanwhile, the HCOB Spain Services PMI decreased to 54.9 in October, down from its prior high of 57.
GBPINR:
- Trading Range: 109.05 – 109.75
The British Pound gained following comments from BoE Governor Andrew Bailey, who struck a less dovish tone than anticipated, spurring optimism in the markets. The Bank of England also hinted at a cautious approach to rate cuts, aiming for a more gradual path. Nevertheless, downside surprises in inflation could lead to quicker cuts.
JPYINR:
- Trading Range: 54.98 – 55.68
The Japanese Yen gained strength as Finance Minister Kato signaled that Japan would address “excessive currency fluctuations.” Despite a slight dip in Japan’s reserve assets to $1.24 trillion in October, there was a smaller-than-expected decline in household spending (down 1.1% YoY in September compared to the previous month’s 1.9% drop), signaling resilience in domestic spending.
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