October 12, 2023
New Delhi, India
The Producer Price Index, which measures the costs for finished goods, rose by 0.5% in the latest month, exceeding the Dow Jones estimate of a 0.3% increase, as reported by the Labor Department. This increase was less than the 0.7% rise observed in August. Meanwhile, the dollar index eased in conjunction with the drop in US Treasury yields after reaching a 16-year high of 4.80%. It appears that markets are increasingly influenced by recent comments from US Fed policymakers, leading to this shift in yields. The 10-year yields have now retreated to 4.60%, marking a two-week low.
Previously, the Indian rupee faced slight downward pressure, closing at 83.2025, down by -0.09%.
The daily trading range for the pair was between 83.25 and 83.15. Traders exercised caution due to potential influences from fluctuating crude oil prices and foreign institutional investor (FII) outflows. The spotlight is now on today’s Consumer Price Index data release.
In the last session, GBPINR displayed upward momentum, closing at 102.2425, up by 0.25%. The daily range for GBPINR spanned from ₹102.36 to 102.08. As for economic indicators, the monthly Gross Domestic Product (GDP) data is anticipated to expand by 0.5%, in contrast to the 0.5% decline observed in July. Investors remain in a state of uncertainty regarding the interest rate outlook following hawkish guidance from Bank of England (BoE) policymaker Katherine Mann. Her stance supports an aggressively tightening approach this week, emphasizing the need to bring down inflation to 2% and eliminate consumer inflation expectations.
EURINR experienced an upward move in the last session, closing at 88.1950, up by 0.08%. The daily range for EURINR was ₹88.36 to 88.13. In addition, German inflation eased in September to the lowest level since the start of the Ukraine war, as reported by the country’s Federal Statistical Office, Destatis. The annual consumer price index remained at 4.5%, in line with earlier estimates, and increased by 0.3% on the previous month, also meeting expectations.
The JPYINR pair gained ground, closing at 55.9775, up by 0.11%. The daily trading range for the pair was between ₹56.01 and 55.9.