November 22, 2024
New Delhi, India
USDINR Today
The Indian Rupee (INR) traded flat on Friday after touching an all-time low of 84.50 against the US Dollar (USD) in the previous session. The HSBC India Manufacturing PMI eased slightly to 57.3 in November, while the Services PMI improved to 59.2.
Factors Influencing INR Performance
- Geopolitical Tensions: Escalating conflict between Russia and Ukraine has pushed crude oil prices higher, adding pressure on the INR.
- Equity Sell-Off: Weakness in domestic equity markets has led to outflows, further weighing on the local currency.
- RBI Intervention: Routine USD interventions by state-run banks, directed by the Reserve Bank of India (RBI), have helped limit losses.
Analyst Insights
Dilip Parmar of HDFC Securities noted that persistent USD demand, portfolio outflows, and concerns about a potential slowdown in India’s economy are likely to keep the INR on a gradual depreciation path.
RBI Governor Shaktikanta Das emphasized that India’s robust economic growth provides flexibility for the central bank to focus on reducing inflation sustainably toward its 4% target.
Global Context
- US Initial Jobless Claims fell to 213K for the week ending November 16, below market expectations of 220K.
- US Existing Home Sales rose by 3.4% in October, reflecting resilience in the US economy.
- Fed Commentary: Chicago Fed President Austan Goolsbee suggested a slower pace for rate cuts as inflation trends closer to the 2% target.
Looking Ahead
Market participants await the US Flash S&P Global PMI data and the final Michigan Consumer Sentiment Index, which are likely to influence USD-INR movements.
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