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Reuters
2 days ago
- Business
- Reuters
Pause in dollar rally offers relief to rupee after 86 breach
MUMBAI, July 18 (Reuters) - The Indian rupee is set to open higher on Friday, tracking a broader recovery in Asian peers and supported by a pause in the U.S. dollar index's near-term uptrend. The 1-month non-deliverable forward indicated an open in the 86.00-86.02 range versus 86.0750 on Thursday, marking the rupee's first sub-86 finish in nearly a month. "Asia will help (the rupee) at the open. However, I'd fade any downside (on USD/INR)," a currency trader at a bank said. "Positioning and risk-reward favour upside, and this looks (like a) buy-on-dips market right now." The dollar index fell about 0.2% in Asia to 98.40, helping most Asian currencies climb higher. The dollar index had rallied on Thursday, approaching the 99 mark, after robust U.S. data spurred expectations that the Federal Reserve will be in no rush to resume rate cuts. Upbeat U.S. retail sales in June pointed to a pickup in economic activity, while job claims fell to a three-month low, reinforcing signs of steady labour market strength. U.S. economic data released on Thursday "continues to signal resilience," MUFG Bank said, while noting the muted reaction in U.S. Treasury yields. Markets were largely unchanged about the Fed outlook, with no major shift in pricing for a September rate cut or the cumulative rate cuts expected in 2025. Despite the dip in the dollar index on Friday, the gauge is up 0.6% this week after last week's near 1% rally. Markets continue to hold net short positions on the U.S. dollar, and an unwinding of those short dollar positions could provide support for the U.S. currency, MUFG Bank noted. KEY INDICATORS: ** One-month non-deliverable rupee forward at 86.08; onshore one-month forward premium at 10 paise ** Dollar index down at 98.41 ** Brent crude futures down 0.1% at $69.5 per barrel ** Ten-year U.S. note yield at 4.44 ** As per NSDL data, foreign investors sold a net $121.3 million worth of Indian shares on July 16 ** NSDL data shows foreign investors bought a net $3.5 million worth of Indian bonds on July 16
Reuters
11-07-2025
- Business
- Reuters
Rupee expected to dip at open after Trump mulls bigger tariff stick
MUMBAI, July 11 (Reuters) - The Indian rupee is poised to open lower on Friday, pressured by dollar's broad strength after U.S. President Donald Trump said he planned to impose blanket tariffs of 15% or 20% on most trade partners. The one-month non-deliverable forward indicated the local currency opening in the 85.70-85.74 range, versus 85.6350 on Thursday. "This slight up move (on dollar/rupee) does not change much in terms of the near-term direction," a currency trader at a bank said. "Interbank will probably wait to see if the up move extends and then will look to fade it. Selling near to 85.90-86.00 has good risk reward, when you consider the recent price action." Tariff headlines lifted the dollar index, putting pressure on Asian currencies. Trump's threat of raising blanket tariffs to 15–20% from the current 10% intensifies concerns about their economic impact. Further, Trump moved to slap a 35% tariff on Canadian goods from August 1, deepening uncertainty around the direction of U.S. trade policy. Throughout the week, Trump has rolled out a series of developments on the U.S. tariffs targeting trading partners, leaving investors to navigate the shifting landscape. So far, the reaction across Asian equities, forex, and rates markets has been largely muted. The rupee itself has not been significantly affected, holding within an 85.50–86.00 range this week - a band that is "broadly in line with expectations," the currency trader said. While the dollar index has risen 0.8% this week, the rally is modest in the context of its 11% decline over the first half of the year. "Our baseline call remains that the dollar will show significantly reduced interest in tariff noise. Data remains a bigger driver, and the potential FX impact of next week's U.S. inflation figures still looks much bigger than trade news," ING Bank said in a note. KEY INDICATORS: ** One-month non-deliverable rupee forward at 85.85; onshore one-month forward premium at 9 paise ** Dollar index up at 97.84 ** Brent crude futures at $68.9 per barrel ** Ten-year U.S. note yield at 4.36% ** As per NSDL data, foreign investors bought a net $78.4 million worth of Indian shares on July 9 ** NSDL data shows foreign investors sold a net $8.6 million worth of Indian bonds on July 9
Yahoo
11-07-2025
- Business
- Yahoo
Rupee expected to dip at open after Trump mulls bigger tariff stick
By Nimesh Vora MUMBAI (Reuters) -The Indian rupee is poised to open lower on Friday, pressured by dollar's broad strength after U.S. President Donald Trump said he planned to impose blanket tariffs of 15% or 20% on most trade partners. The one-month non-deliverable forward indicated the local currency opening in the 85.70-85.74 range, versus 85.6350 on Thursday. "This slight up move (on dollar/rupee) does not change much in terms of the near-term direction," a currency trader at a bank said. "Interbank will probably wait to see if the up move extends and then will look to fade it. Selling near to 85.90-86.00 has good risk reward, when you consider the recent price action." Tariff headlines lifted the dollar index, putting pressure on Asian currencies. Trump's threat of raising blanket tariffs to 15–20% from the current 10% intensifies concerns about their economic impact. Further, Trump moved to slap a 35% tariff on Canadian goods from August 1, deepening uncertainty around the direction of U.S. trade policy. Throughout the week, Trump has rolled out a series of developments on the U.S. tariffs targeting trading partners, leaving investors to navigate the shifting landscape. So far, the reaction across Asian equities, forex, and rates markets has been largely muted. The rupee itself has not been significantly affected, holding within an 85.50–86.00 range this week - a band that is "broadly in line with expectations," the currency trader said. While the dollar index has risen 0.8% this week, the rally is modest in the context of its 11% decline over the first half of the year. "Our baseline call remains that the dollar will show significantly reduced interest in tariff noise. Data remains a bigger driver, and the potential FX impact of next week's U.S. inflation figures still looks much bigger than trade news," ING Bank said in a note. KEY INDICATORS: ** One-month non-deliverable rupee forward at 85.85; onshore one-month forward premium at 9 paise ** Dollar index up at 97.84 ** Brent crude futures at $68.9 per barrel ** Ten-year U.S. note yield at 4.36% ** As per NSDL data, foreign investors bought a net $78.4 million worth of Indian shares on July 9 ** NSDL data shows foreign investors sold a net $8.6 million worth of Indian bonds on July 9
Reuters
02-06-2025
- Business
- Reuters
Rupee supported at open by dollar dip on US tariffs, fiscal concerns
MUMBAI, June 2 (Reuters) - The Indian rupee is expected to be supported at the open on Monday following a decline in the U.S. dollar due to tariff-related developments and fiscal concerns. The 1-month non-deliverable forward indicated an open in the 85.52-85.54 range, versus 85.5775 in the previous session. The dollar index slipped 0.2% while Asian currencies were mixed on the day. "Not much on the Asian front to guide the rupee today, with two-way flows likely to dominate in the 85.50–85.70 band," a currency trader at a Mumbai-based bank said. According to the trader, interbank players are looking to sell dollar/rupee on up ticks, with stops placed around the 86 mark. In recent sessions, the rupee has found support in the 85.60–85.70 zone, with bankers noting broad-based interest in selling dollars at those levels. The dollar kicked off the week on the defensive against its major peers, weighed down by ongoing uncertainty over U.S. tariffs. President Donald Trump announced late Friday his intention to double duties on imported steel and aluminium to 50%, effective Wednesday. This follows a U.S. trade court that initially blocked much of Trump's tariff plan, ruling that he had overstepped his authority. However, an appeals court later reinstated the bulk of those duties, reigniting market caution. The dollar has further been weighed down by fiscal worries in recent weeks. The U.S. Senate will consider Trump's sweeping tax cut and spending bill, which will add an estimated $3.8 trillion to the $36.2 trillion in debt over the next decade. "US growth and interest rates should continue to converge lower than in many other major economies", which should keep the dollar under pressure, ING Bank said. "And there's still a sizeable risk that fiscal credibility issues take their toll on US assets this summer." KEY INDICATORS: ** One-month non-deliverable rupee forward at 85.64; onshore one-month forward premium at 13.25 paisa ** Dollar index down at 99.2 ** Brent crude futures up 2.7% at $64.5 per barrel ** Ten-year U.S. note yield at 4.41% ** As per NSDL data, foreign investors sold a net $205.6mln worth of Indian shares on May 29 ** NSDL data shows foreign investors bought a net $3,412.8mln worth of Indian bonds on May 29
Reuters
09-05-2025
- Business
- Reuters
Rupee likely to weaken more on widening India-Pakistan conflict
MUMBAI, May 9 (Reuters) - The Indian rupee looks set to decline further on Friday, pressured by the widening conflict between India and Pakistan that may trigger increase hedging and speculative activity. The 1-month non-deliverable forward indicated that the rupee will open at 85.80 to 85.90 to the U.S. dollar compared with 85.71 in the previous session. The rupee on Wednesday slumped 1.04%, recording its worst session in more than two years. The currency came under pressure in the afternoon session after India reported Pakistan's attempts to engage military targets. "Until yesterday afternoon, markets had largely priced in a view that there would be no meaningful worsening in India-Pakistan tensions," a currency trader at a Mumbai-based bank said. "That assumption is now being reassessed, and positioning in the rupee will likely need to be adjusted accordingly," and it may lead to a pick-up in hedging and speculative activity, the trader said. Pakistan and India accused each other of launching drone attacks on Thursday, and Islamabad's Defense Minister said further retaliation was 'increasingly certain'. India said military stations were attacked by Pakistani drones and missiles. Indian equities were set to open more than 1% lower. In the two sessions following the rise in tensions, the activity of foreign investors indicates that they largely held the view that the situation would not have a lasting impact on the Indian economy, analysts said. Preliminary data showed that foreign investors were net buyers of Indian equities on Thursday, after buying approximately $350 million on Wednesday. "It will be interesting to see how the numbers pan out in today's session. There's a sense that the landscape has shifted,' said Kunal Kurani, Assistant Vice President at Mecklai Financial. Other Asian currencies largely weakened on Friday, while the U.S. dollar rose against its major counterparts, creating additional headwinds for the rupee. KEY INDICATORS: ** One-month non-deliverable rupee forward at 86.12; onshore one-month forward premium at 18.75 paise ** Dollar index up at 100.76 ** Brent crude futures up 0.1% at $62.9 per barrel ** Ten-year U.S. note yield at 4.37% ** As per NSDL data, foreign investors bought a net $349.1 mln worth of Indian shares on May 7 ** NSDL data shows foreign investors sold a net $115.7 mln worth of Indian bonds on May 7
