USD/INR hits fresh weekly tops at 71.50 as Indo-Pak tensions escalate

• Escalating Indo-Pak tensions knock-off the Rupee, 72.00 back on sight.
• Eyes on Indo-Pak- related headlines, Powell’s testimony and US data for fresh impetus.

The Indian National Rupee (INR) extended losing streak versus the US dollar into a third day today, prompting the USD/INR cross to refresh fresh six-day tops at 71.50 levels. At the press time, the cross trades +0.50% higher at 71.35.

The latest leg down in the Indian currency can be mainly attributed to escalating geopolitical tensions between India and Pakistan after both the sides exchanged fire along their contested border in Kashmir.  The USD/INR pair picked up bids on the reports and rallied from 70.91 levels to the midpoint of the 0.71 handle.

On Tuesday, Indian warplanes struck inside Pakistan on a militant training base for the first time since a war in 1971, avenging a suicide car bombing by Pakistan-based militants in Indian-controlled Kashmir that killed at least 40 policy personnel on Feb. 14.

Looking ahead, softer risk tones are likely to prevail, as the focus will remain on the developments around the Indo-Pak geopolitics while the round 2 of Fed Chair Powell’s testimony will be also eyed for fresh dollar trades.

USD/INR Technical Levels