USD/INR: Stronger Rupee on Oil slide – Societe Generale
Societe Generale’s EM team, including Santosh Ejanthkar and Tanmay Purohit, note the Indian Rupee is at its strongest level in over six months, with USD/INR breaking below 94.00 as a sharp Brent decline improves India’s terms of trade and inflation outlook.
Societe Generale's EM team reports that the Indian Rupee has reached its strongest level in over six months, with USD/INR dipping below 94.00. This improvement in the Rupee's value is attributed to a sharp decline in Brent crude oil prices, which enhances India's terms of trade and eases inflation concerns. Economist Kunal Kundu forecasts a surge in headline CPI to 6.3% year-over-year in October, suggesting the RBI may raise rates by 25 basis points to 5.75% in December.
The shift in global AI trade and lower oil prices are also contributing to the Rupee's strength and favorable conditions for Indian equities, bonds, and the local currency.
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