June 21, 2024
New Delhi, India
Daily Currency Market Update
USDINR
Trading Range: 83.52-83.6
The Rupee steadied, bolstered by portfolio inflows and improved odds of rate cuts by the Federal Reserve later this year. Investors are currently pricing in a 67% chance of a rate cut in September, up from about 61% a day earlier, which has further supported the currency.
EURINR
Trading Range: 88.97-90.37
The Euro dropped as market participants actively monitor the political situation in France. The European Central Bank (ECB) recently implemented its first rate cut in five years but is adopting a cautious stance towards additional cuts. Meanwhile, wages in the Eurozone rose 5.3% year-on-year in Q1, the most significant increase since Q4 2022.
GBPINR
Trading Range: 106.20-105.66
The British Pound surged due to a weaker dollar after softer US inflation data reinforced the view that the Fed will deliver its first rate cut in September. The GBP edged up after inflation in the UK fell back to the central bank’s 2% target in May as expected. Core inflation eased to 3.5% from 3.9%, in line with forecasts, and services inflation was down to 5.7% from 5.9%, above expectations of 5.5%. Despite this, the Bank of England recently stated that inflation hitting the target alone won’t prompt interest rate cuts.
JPYINR
Trading Range: 53-53.5
The Japanese Yen dropped as the BOJ Governor told the Japanese parliament that they could raise interest rates again at the July meeting. Bank of Japan (BOJ) members are discussing policy normalization amid a weak yen. Japan’s trade deficit decreased to JPY 1,221 billion in May 2024 from JPY 1,382 billion in the same month of the previous year.
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