Indian Rupee starts the week with a bang on US-Iran peace 2.0
The Indian Rupee (INR) opens strongly against the US Dollar (USD) at the start of the week. The USD/INR extends its losing streak for the third trading day, is down 0.25% to near 95.15, the lowest level seen in over three weeks.
The Indian Rupee (INR) began the week with a strong performance against the US Dollar (USD) following the announcement of a ceasefire between the United States (US) and Iran. The USD/INR exchange rate dropped to around 95.35, recovering from a three-week low of 95.15. This improvement was attributed to the decline in oil prices, which lowered the appeal of safe-haven assets, including the US Dollar.
The US Dollar Index (DXY) turned positive, as traders anticipated an interest rate hike by the Federal Reserve (Fed) at the September meeting. Investors closely monitored US economic data, including the US Nonfarm Payrolls (NFP) report and the ISM Manufacturing PMI, with expectations of a potential Fed rate hike. The Reserve Bank of India (RBI) was set to announce its monetary policy in the week, and economists expected the central bank to maintain the policy stance unchanged due to contained inflation.
Technical analysis suggested that the INR may face challenges as it hovers below key support levels, with resistance expected around 95.75 and support near 94.78 and 94.15.
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