December 20, 2024
New Delhi, India
USDINR
Rupee (INR) continued its downward trajectory on Friday, softening after hitting a historic low of 85.12 in the previous session. A hawkish rate cut by the US Federal Reserve has bolstered the US Dollar (USD), putting pressure on emerging market currencies, including the INR.
Key Factors Impacting the INR
- Hawkish Fed Policy: The Federal Reserve’s aggressive stance has strengthened the USD, intensifying challenges for the rupee.
- Declining Forex Reserves: India’s foreign exchange reserves fell for the ninth time in ten weeks, reaching $654.857 billion, well below the peak of $704.89 billion in September.
- Oil Prices: While the dip in crude oil prices may provide some relief, India’s dependency on oil imports keeps the INR vulnerable.
Economic Indicators to Watch
- US Core PCE Price Index: Traders are closely monitoring this key inflation metric, set to release later on Friday.
- US Michigan Consumer Sentiment Index: This data, also due Friday, will offer further insights into US economic conditions.
Global Economic Highlights
- US GDP Growth: The US economy grew at an annualized rate of 3.1% in Q3, exceeding the 2.8% projection.
- Job Market Resilience: Initial jobless claims dropped to 220,000, reflecting robust employment trends.
Outlook
Despite headwinds, lower crude oil prices and potential intervention by the Reserve Bank of India (RBI) could help stabilize the rupee and limit volatility. The market will remain focused on US economic data for further cues on global currency movements.
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Breaking News: Rupee Hits Record Low of ₹85 Against US Dollar
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