After hitting a month-high against the US Dollar yesterday the Rupee posted its most significant decline for two weeks as the shadow of the Federal Open Market Committee’s two-day policy meeting weighed on the currency.
The US Dollar to Indian Rupee Exchange Rate was in the region of 63.1000 as of 10:25 GMT
Although the Federal Open Market Committee is expected to issue a dovish policy statement given recent disappointing US data (such as a surprising US non-farm payrolls report) economists have forecast that the FOMC will opt to taper bond buying by $15 Billion when its meeting comes to an end tomorrow.
If asset purchases are reduced to $75 billion the US Dollar could recover some of its recent losses and the Rupee may extend declines.
After shedding 1 per cent against its North American rival the Rupee weakened to 63.6300 before an upward correction saw it trading in the region of 62.1500.
The US Dollar to Rupee (USD/INR) exchange rate hit a low of 62.9800
The Rupee was also feeling the pressure ahead of tomorrow’s Reserve Bank of India rate decision, the first since Raghuram Rajan took over as Governor.
According to forex expert Vivek Chaturvedi, ‘Nobody really wants to take a view ahead of the Fed and RBI decisions. The Rupee is in a delicate balance’.
Despite today’s losses the Rupee has still strengthened by 3.3 per cent this month and lost the dubious distinction of being Asia’s worst performing currency. The Rupee’s boost was triggered by Rajan asserting his new authority and announcing his intention to take decisive measures to help the Indian economy to heal while stabilising the Rupee.
The RBI rate decision is scheduled to take place tomorrow.
During the European session the Rupee retained a modest gain against the Pound, despite UK inflation slowing to 2.7 per cent last month as expected.
Today’s US inflation figures could impact the USD/INR pairing ahead of the FOMC announcement.
Current Rupee (INR) Exchange Rates:
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The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 100.3820 <
The Euro/Indian Rupee Exchange Rate is currently in the region of: 84.1395 <
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 63.1000 <
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 58.8786 <
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 51.6403 <
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 61.1359 <
(Correct as of 10:25 GMT)
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