November 12, 2024
New Delhi, India
USDINR Today
Rupee (INR) struggled to stabilize on Tuesday, hovering close to its all-time low of 84.38. The local currency faces ongoing pressure due to significant foreign fund outflows and increasing demand for the US Dollar (USD), particularly from oil companies and foreign banks.
Key Factors Influencing INR:
- Foreign Fund Outflows: Over $2.5 billion pulled out from Indian stocks in November, adding to the $11 billion outflows in October.
- Strong USD Demand: Renewed demand from foreign banks and oil importers is weighing on the rupee.
- Market Anticipation: Traders are eyeing India’s October CPI release and upcoming speeches from Federal Reserve officials.
Possible Support for INR:
- Crude Oil Prices: A decline in crude oil prices could provide temporary relief to the rupee.
- RBI Intervention: Potential foreign exchange intervention by the Reserve Bank of India (RBI) may help curb further depreciation.
- India’s Forex Reserves: The reserves declined by $2.675 billion to $682.13 billion as of November 1.
Economic Data in Focus:
- India’s October CPI: Expected to rise to 5.80% YoY, up from 5.49% previously.
- US CPI Data: Investors are also awaiting the US October CPI figures for insights on the Fed’s rate decision in December.
Global Market Impact:
- Trump’s Victory Impact: Following Trump’s election win, the USD has strengthened, with expectations of inflationary policies reducing the likelihood of a Fed rate cut from 75% to 65%.
- Asian Markets Reaction: Regional indices turned negative, with semiconductor stocks hit by reports of halted shipments to China by Taiwan Semiconductor Manufacturing Co.
With market participants closely watching domestic and global economic cues, the rupee’s performance will likely remain under pressure in the near term.
At thetime of writing this article, USDINR was trading around 84.402 down -0.02%
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