- 71.05 is a tough nut to crack for bulls amid trade doubts and dollar purchases.
- Rupee finds support from foreign inflows into local equities.
- Focus on US macro data and trade developments for fresh trading impetus.
USD/INR failed another attempt above the 71 handle, as the Indian rupee was rescued by increased foreign fund inflows into the local equities.
The Indian benchmarks, BSE Sensex and NSE index hit fresh record highs, tracking gains in their Asian and Wall Street counterparts, in light of the optimism over US-China trade resolution.
However, the retreat in the spot appears limit as the Asian currency will likely remain under pressure amid doubts over the trade deal details that face Beijing’s reticence. Meanwhile, the US dollar continues to benefit from the trade skepticism across its main peers. The US dollar index is flirting with daily tops of 97.15, up +0.13% on the day.
Further, increased dollar purchases from the state-run Indian banks are also likely to keep the INR recovery in check. Markets now look forward to the US Industrial Production and JOLTS job openings data for fresh dollar trades while the trade headlines will continue to keep the driver’s seat.
USD/INR Technical levels to consider
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