December 4, 2024
New Delhi, India
Rupee (INR) traded flat on Wednesday following its all-time low in the previous session. Weak GDP growth, persistent foreign outflows, and robust demand for the US Dollar (USD) continue to weigh on the INR. However, the Reserve Bank of India’s (RBI) forex intervention through USD sales has capped further depreciation.
Key Economic Events in Focus
- India PMI Data: Investors await the HSBC India Services PMI, expected to rise to 59.2 in November from 58.5 in October. A stronger reading could provide near-term support to the Rupee.
- US Economic Releases: The ADP Employment Change, ISM Services PMI, and Fed Chair Jerome Powell’s speech are among the key events to watch.
Expert Take on INR Performance
“The RBI’s interventions may provide temporary relief to the Rupee, but broader economic factors, including geopolitical uncertainties, will likely keep it under pressure,” said Vishnu Kant Upadhyay, AVP – Research and Advisory, Master Capital Services Ltd.
Global Factors at Play
- US Labor Market: JOLTs Job Openings rose to 7.744 million in November, surpassing market expectations of 7.48 million.
- Fed Signals: Recent comments from Fed officials suggest potential rate recalibration amid inflation progress and a resilient job market.
While RBI measures might offer short-term relief, sustained pressure on the Rupee underscores the need for economic stability and a clear direction from global events.
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