Latest news with #IndianRupee
Reuters
a day ago
- Business
- Reuters
Rupee posts best week in over two years as dollar's struggles resurface
MUMBAI, June 25 (Reuters) - The Indian rupee had its best week since January 2023, as an Iran-Israel ceasefire cooled oil prices and sapped safe-haven dollar demand, while worries over the Federal Reserve's future independence added pressure on the greenback. The rupee gained 1.3% on the week, its best performance in two and a half years, to close at 85.4750 per U.S. dollar on Friday. Crude oil prices retreated by over 11% this week after Iran and Israel reached a ceasefire following a 12-day war, which saw involvement of the U.S. Meanwhile, the dollar index was down 1.5% on the week as investors, unnerved by fresh signs of an erosion in U.S. central bank independence, wasted no time in pushing the greenback back to its lowest levels in over three years. "Part of the sell-off of the dollar is due to the unpredictability of policy from Washington and that is unlikely to change," MUFG Bank said in a note. The rupee rose this week but it continues to lag behind its Asian peers amid persistent dollar weakness seen over 2025. While currencies like the Korean won and offshore Chinese yuan are up between 2% and 9% this year so far, the rupee is little changed. Bankers and analysts reckon that while the rupee's underperformance is likely to persist, a broadly weaker dollar alongside portfolio inflows should support the currency in the near term. Foreign investors have turned buyers on Indian government bonds over the last few sessions, while block trades and initial public offerings have drawn interest from global investors. Later on Friday, the focus will be on U.S. personal consumption expenditure (PCE) inflation data alongside remarks from Fed policymakers as investors try to gauge the future trajectory of the central bank's policy rates.
Yahoo
a day ago
- Business
- Yahoo
Rupee's upside capped by dollar bids from foreign and state-run banks
(Refiles to correct date in dateline to June 27) MUMBAI (Reuters) -The Indian rupee edged higher on Friday as the dollar grappled with concerns over the future independence of the Federal Reserve and heightened expectations of cuts to U.S. benchmark interest rates. However, dollar bids from foreign and state-run banks put a lid on the rupee's gains after it managed to rise above the 85.50 mark in early trading. The currency was last quoted at 85.5375 against the dollar, up 0.2% on the day. The dollar index was at 97.4, hovering close to an over three-year low, while Asian currencies were trading mixed. India's benchmark equity indexes, the BSE Sensex and Nifty 50, logged slight gains. Speculation that U.S. President Donald Trump may make an earlier-than-usual announcement of the next Federal Reserve chair, who is expected to be more dovish, has raised wagers on policy easing by the Fed. That, in turn, has weighed on the greenback, which is already under pressure over concerns about U.S. trade and fiscal policies this year. The dollar index is down over 10% year-to-date and is on track for its biggest first-half fall since the start of the era of free-floating currencies in the early 1970s. BofA Global Research holds a bearish view on the dollar over the medium to longer term due to U.S. economic uncertainty, the overhang of eventual Fed cuts, alongside a push from global real money investors, who are in the early stages of increasing FX hedging of U.S. assets. Meanwhile, the dollar-rupee overnight swap rate nudged higher on Friday, with traders pointing to sell/buy swaps from foreign banks, likely spurred by dollar inflows related to a large domestic IPO. Bidding for Indian lender HDB Financial's $1.5 billion IPO is set to close on Friday. The issue was subscribed by nearly two times as of 11:30 a.m. IST. Sign in to access your portfolio
Reuters
a day ago
- Business
- Reuters
Rupee's upside capped by dollar bids from foreign and state-run banks
MUMBAI, June 25 (Reuters) - The Indian rupee edged higher on Friday as the dollar grappled with concerns over the future independence of the Federal Reserve and heightened expectations of cuts to U.S. benchmark interest rates. However, dollar bids from foreign and state-run banks put a lid on the rupee's gains after it managed to rise above the 85.50 mark in early trading. The currency was last quoted at 85.5375 against the dollar, up 0.2% on the day. The dollar index was at 97.4, hovering close to an over three-year low, while Asian currencies were trading mixed. India's benchmark equity indexes, the BSE Sensex (.BSESN), opens new tab and Nifty 50 (.NSEI), opens new tab, logged slight gains. Speculation that U.S. President Donald Trump may make an earlier-than-usual announcement of the next Federal Reserve chair, who is expected to be more dovish, has raised wagers on policy easing by the Fed. That, in turn, has weighed on the greenback, which is already under pressure over concerns about U.S. trade and fiscal policies this year. The dollar index is down over 10% year-to-date and is on track for its biggest first-half fall since the start of the era of free-floating currencies in the early 1970s. BofA Global Research holds a bearish view on the dollar over the medium to longer term due to U.S. economic uncertainty, the overhang of eventual Fed cuts, alongside a push from global real money investors, who are in the early stages of increasing FX hedging of U.S. assets. Meanwhile, the dollar-rupee overnight swap rate nudged higher on Friday, with traders pointing to sell/buy swaps from foreign banks, likely spurred by dollar inflows related to a large domestic IPO. Bidding for Indian lender HDB Financial's $1.5 billion IPO is set to close on Friday. The issue was subscribed by nearly two times as of 11:30 a.m. IST.
Reuters
a day ago
- Business
- Reuters
Fed rate cut bets to help rupee extend weekly rally
Mumbai, June 27 (Reuters) - The Indian rupee is set to climb further on Friday, supported by weak U.S. data that has strengthened expectations of a Federal Reserve rate cut in September, and possibly earlier. The one-month non-deliverable forward indicated an open in the 85.58-85.62 range, versus 85.7050 in the previous session. The rupee has already risen 1% through Thursday and is on track for its best weekly showing in several weeks, driven largely by a plunge in oil prices after the Israel-Iran ceasefire. The currency finally broke past the 86 handle on Thursday - a level it had been struggling to crack in prior sessions. The break probably "unlocks the next leg lower" for USD/INR pair, a currency trader at a Mumbai-based bank said. "Interbank positioning isn't a hurdle. Price action over the next few sessions will tell us if this has turned into a sell-on-rallies market," the trader said. U.S. first-quarter GDP contracted a bit faster than previously thought. The downward revision was led by consumption, which was trimmed by 0.7 percentage points to a 0.5% pace entirely because of softer services spending, Morgan Stanley said in a note. "Our economists note the tone of 1Q25 data changed and now suggests a household sector that was retrenching at the start of the year," it said Meanwhile, U.S. initial jobless claims declined in the week through June 21. However, the number of people receiving benefits after an initial week of aid, a proxy for hiring, increased to its highest level since November 2021. The 10-year U.S. yield fell to its lowest in nearly two months on Thursday, amid markets pricing in more Fed rate cuts than what the June dot plot had suggested. The dollar index remains pinned near multi-year lows, reflecting the rate expectations. KEY INDICATORS: ** One-month non-deliverable rupee forward at 85.70; onshore one-month forward premium at 12 paise ** Dollar index down at 97.3 ** Brent crude futures up 0.6% at $68.2 per barrel ** Ten-year U.S. note yield at 4.26% ** As per NSDL data, foreign investors sold a net $99.5mln worth of Indian shares on Jun. 25 ** NSDL data shows foreign investors sold a net $39.8mln worth of Indian bonds on Jun. 25
Yahoo
a day ago
- Business
- Yahoo
Fed rate cut bets to help rupee extend weekly rally
By Nimesh Vora Mumbai (Reuters) -The Indian rupee is set to climb further on Friday, supported by weak U.S. data that has strengthened expectations of a Federal Reserve rate cut in September, and possibly earlier. The one-month non-deliverable forward indicated an open in the 85.58-85.62 range, versus 85.7050 in the previous session. The rupee has already risen 1% through Thursday and is on track for its best weekly showing in several weeks, driven largely by a plunge in oil prices after the Israel-Iran ceasefire. The currency finally broke past the 86 handle on Thursday - a level it had been struggling to crack in prior sessions. The break probably "unlocks the next leg lower" for USD/INR pair, a currency trader at a Mumbai-based bank said. "Interbank positioning isn't a hurdle. Price action over the next few sessions will tell us if this has turned into a sell-on-rallies market," the trader said. U.S. DATA SUPPORTS FED RATE CUTS U.S. first-quarter GDP contracted a bit faster than previously thought. The downward revision was led by consumption, which was trimmed by 0.7 percentage points to a 0.5% pace entirely because of softer services spending, Morgan Stanley said in a note. "Our economists note the tone of 1Q25 data changed and now suggests a household sector that was retrenching at the start of the year," it said Meanwhile, U.S. initial jobless claims declined in the week through June 21. However, the number of people receiving benefits after an initial week of aid, a proxy for hiring, increased to its highest level since November 2021. The 10-year U.S. yield fell to its lowest in nearly two months on Thursday, amid markets pricing in more Fed rate cuts than what the June dot plot had suggested. The dollar index remains pinned near multi-year lows, reflecting the rate expectations. KEY INDICATORS: ** One-month non-deliverable rupee forward at 85.70; onshore one-month forward premium at 12 paise ** Dollar index down at 97.3 ** Brent crude futures up 0.6% at $68.2 per barrel ** Ten-year U.S. note yield at 4.26% ** As per NSDL data, foreign investors sold a net $99.5mln worth of Indian shares on Jun. 25 ** NSDL data shows foreign investors sold a net $39.8mln worth of Indian bonds on Jun. 25 Sign in to access your portfolio
