USD/CAD: Loonie Strengthens as Oil Prices Rise on U.S. Supply Concerns

The Canadian dollar strengthened against its U.S. counterpart on Monday after oil prices climbed over $70 a barrel as U.S. supplies have been restricted following Hurricane Ida, which hit almost half of crude production in key producing regions.

The USD/CAD pair fell to 1.2643 today, down from Friday’s close of 1.2689. The Canadian dollar lost over 1.2% last month and has depreciated about 0.3% so far this month.

Canada is the world’s fourth-largest exporter of oil, which edge higher on low U.S. output after Hurricane Ida. U.S. West Texas Intermediate (WTI) crude futures were trading 1.05% higher at $70.46 a barrel. Higher oil prices lead to higher U.S. dollar earnings for Canadian exporters, resulting in an increased value of the loonie.

“The electoral campaign in Canada is set to remain in focus with only 10 days to go before the vote, and we think that CAD is currently discounting some political risk as opinion polls show neither of the two major parties (Liberals and Conservatives) as likely to secure a full majority in the House,” noted Francesco Pesole, FX Strategist at ING.

“Next week, CPI data will be the main highlight and another above-consensus read may further support hawkish expectations on the BoC, but once again, political risk may cap CAD gains for now. Once political uncertainty dissipates, a short-term undervaluation vs USD (2.1%, according to our fair value model) and solid fundamentals all point to a rebound in the loonie, in our view.”

The dollar index, which measures the value of the dollar against six foreign currencies, was trading 0.02% higher at 92.599. On Tuesday, September 14, the consumer price index is scheduled to be released. Global trends and inflation data will drive equity markets next week, which after a run of record-breaking trades have taken a breather. If the data continues to be hot, Treasury yields could rise, which would be negative for the market.

However, it is highly likely that the world’s dominant reserve currency, the USD, will rise by end of the year, largely due to the expectation of two rate hikes by the Fed in 2023. With the dollar strengthening and a possibility that the Federal Reserve will raise interest rates earlier than expected, the USD/CAD pair may experience a rise.

In August, Canada added 90,200 jobs, and the unemployment rate fell to 7.1%, its lowest level since the Coronavirus pandemic began. The data might support the Bank of Canada’s next taper in October. The Governor of the Bank of Canada, Tiff Macklem, said on Thursday that Canada is on its way to no longer needing quantitative easing to stimulate the economy.

Last week, the Bank of Canada held its key interest rate, citing fears that the pandemic and supply bottlenecks might stall the economic recovery. The central bank has maintained its overnight rate target at 0.25% and said it will continue buying bonds at a rate of $2 billion a week as part of its quantitative easing program.

Dollar Drops With US Yields, Euro Buoyed as ECB Trims Emergency Support

The greenback has largely moved in line with Treasury yields this week. Yields fell on Thursday after the Treasury completed $120 billion in coupon-bearing supply scheduled for this week.

Against a basket of peers, the dollar is holding above a one-month low reached on Friday when jobs data for August showed that jobs growth slowed.

The dollar index dropped 0.23% to 92.47, up from a one-month low of 91.94 on Friday.

Investors are focused on when the Federal Reserve is likely to begin paring bond purchases as it balances rising price pressures against a still relatively soft employment picture.

Chicago Federal Reserve President Charles Evans on Thursday said the U.S. economy is “not out of the woods yet,” and that despite strong economic growth and the promise of vaccines, challenges remain, including supply chain and labor market bottlenecks.

Fed Governor Michelle Bowman, meanwhile, added her voice to the growing number of policymakers who say the weak August jobs report likely won’t throw off the central bank’s plan to trim its $120 billion in monthly bond purchases later this year.

Data on Thursday showed that the number of Americans filing new claims for jobless benefits fell last week to the lowest level in nearly 18 months, offering more evidence that job growth was being hindered by labor shortages rather than cooling demand for workers.

The euro was also supported after the ECB maintained a dovish tone and offered no major surprises as it took a first small step toward unwinding the emergency aid that has propped up the euro zone economy during the pandemic.

In the past two quarters, the bank has purchased around 80 billion euros worth of debt each month. It provided no numerical guidance for the three months ahead, but analysts had predicted before the meeting that purchases would fall to between 60 billion and 70 billion euros in those months.

“The ECB is delivering mainly as expected today,” analysts at TD Securities said in a report. “Looking ahead, the focus will be on how the ECB defines “moderately” – anything less than €60bn/mo could be bearish.”

The euro gained 0.11% on the day to $1.1828.

Bitcoin edged higher it attempted to recover from a large and sudden price drop on Tuesday.

The cryptocurrency gained 1.28% to $46,680.

For a look at all of today’s economic events, check out our economic calendar.

(Reporting by Karen Brettell; Editing by Philippa Fletcher and Jonathan Oatis)

 

Easing Virus Woes Lift Asia FX View; Baht Bears at 6-Month Low – Reuters Poll

Countries, including Malaysia, Indonesia, and Thailand, have seen a drop in infections, enabling them to relax restrictions, while Singapore last month became the world’s most vaccinated country after it fully inoculated 80% of its population.

The U.S. Federal Reserve holding off on earlier-than-expected tapering of its massive asset purchases kept the dollar in check and further supported sentiment towards emerging currencies.

Investors placed long bets on the Chinese yuan for the first time since mid-July, and cut short bets on South Korea’s won, Malaysia’s ringgit and the Philippine peso, according to the poll of 11 respondents.

They also turned bullish on Singapore’s dollar and Indonesia’s rupiah for the first time since mid-June.

Short positions on the baht unwounded to their lowest since Feb. 25 as the tourism-reliant economy relaxed COVID-19 curbs, prompting its leading joint-business group to raise its 2021 economic forecast.

Market view of the region’s worst performing currency this year was also buttressed after Prime Minister Prayuth Chan-ocha survived a no confidence vote in parliament last week.

The baht is not out of woods yet, however, analysts at DBS Bank said while highlighting Thailand’s flip to a current account deficit since last year and potential policy normalisation from the Fed.

“Thailand’s need for external financing is coming at a potentially challenging period. The Thai baht is therefore vulnerable to any surprise in the Fed’s hawkish tilt,” they said.

The baht was seen weakening to 35-36 against the greenback by the first quarter of 2022. The currency traded at around 32.70 against the dollar on Thursday.

Long bets on India’s rupee rose to their highest in more than six months, as investors were convinced that a sustained economic recovery was underway despite warnings of a possible third wave of COVID-19 infections.

“Policy makers are likely to remain wary about potential increases in infections and their impact on economic activity,” Standard Chartered Global Research said in a note this week.

“However, given the recent increase in vaccinations and the reduced sensitivity of economic activity to COVID-19 infections, the impact of any future rise in infections is unlikely to derail the recovery process.”

The Reuters survey is focused on what analysts believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht.

The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3.

A score of plus 3 indicates the market is significantly long U.S. dollars. The figures included positions held through non-deliverable forwards (NDFs).

The survey findings ASIAPOSN are provided below (positions in U.S. dollar versus each currency):

DATE USD/CNY USD/KRW USD/SGD USD/IDR USD/TWD USD/INR USD/MYR USD/PHP USD/THB

09/09 -0.09 0.33 -0.36 -0.44 -0.69 -0.88 0.23 0.40 0.12

26/08 0.425 0.868 0.474 0.18 0.326 -0.08 1.1922 0.779 1.351

12/08 0.32 0.69 0.77 0.2 -0.09 0.37 1.39 1.17 1.75

29/07 0.27 0.78 0.71 0.27 0.36 0.29 1.4 1.21 1.49

15/07 -0.15 0.27 0.53 0.23 0.13 0.68 1.06 1.06 1.56

01/07 -0.29 -0.29 0.02 0.36 -0.19 0.5 0.49 -0.04 0.85

17/06 -0.63 -0.36 -0.49 -0.5 -0.58 -0.21 -0.05 -0.31 0.2

03/06 -1.34 -0.51 -0.55 -0.4 -0.44 -0.71 0.32 -0.66 0.37

20/05 -0.33 0.43 0.37 -0.06 0.33 -0.03 0.26 -0.22 0.81

06/05 -0.52 -0.39 -0.58 0.31 -0.59 0.86 -0.04 -0.35 0.5

(Reporting by Shashwat Awasthi; editing by Uttaresh.V)

USD/INR: Rupee Extends Losses, Falls 8 Paise in Early Trade

The Indian rupee opened lower, depreciating by 8 paise against the U.S. dollar in early trade Tuesday as strong greenback and volatility in the domestic equity market continued to pressurize the battered Asian currency.

The rupee hit a three-month low on Monday as traders moved to the safety of the U.S. dollar amid rising COVID-19 cases that threaten to derail the global economic recovery.

The dollar to rupee conversion today rose to 74.95 against the U.S. currency, up from Monday’s close of 74.87. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened over 60 paise so far this month.

“The rupee witnessed sharp depreciation against the dollar in the last session and lost 55 paise amid a strengthening dollar index. The safe-haven US dollar moved higher against a basket of major currencies on Monday as investors grew nervous about a raging coronavirus variant that could threaten the outlook for a global economic recovery. The greenback jumped even as the US 10-year Treasury yield dropped to a more than the five-month low of 1.176%,” noted analysts at ICICI Direct.

“The USD to INR has moved higher towards 75 levels surpassing its highest Call base. Continued up move towards 75.50 is expected in the coming sessions. The dollar to rupee July contract on the NSE was at 75.02 in the last session. The open interest fell almost 1% for the July series while August series OI increased by almost 60%.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading nearly flat at 92.894 – not far from this year’s high of 93.437.

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

Global oil benchmark Brent futures traded 0.12% higher at $68.70 per barrel at the time of writing. Earlier this month, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement. Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 290 points or 0.56% lower at 52,262.45, while the broader NSE Nifty slumped 95.90 points or 0.61% to 15,655.35. Foreign institutional investors were net sellers in the capital market on Monday as they offloaded shares worth Rs 2,198.71 crore, as per exchange data.

USD/INR: Rupee Slumps 25 Paise, Further Downside Risks Remain

The Indian rupee opened lower, depreciating by over 25 paise against the U.S. dollar in early trade Monday as firm greenback and weakness in the domestic equity market continued to pressurise the battered Asian currency.

The dollar to rupee conversion today rose to 74.8125 against the U.S. currency, up from Friday’s close of 74.56. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened about 49 paise so far this month.

“The rupee continued to trade in a range and last Friday ended almost flat, down 2 paise. The dollar posted modest gains on stronger-than-expected US June retail sales data. The dollar also garnered some support from a fall in the S&P 500 to a one-week low, which boosted the dollar’s liquidity demand,” noted analysts at ICICI Direct.

“The USD to INR is seeing contracting volatility while the trading range has been narrowing for a few sessions. Looking at the writing in OTM Call we feel upsides seem limited. The dollar to rupee July contract on the NSE was at 74.71 in the last session. The open interest fell 1.8% for the July series.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.25% higher at 92.911 – not far from this year’s high of 93.437. That gain was largely driven by safe-haven buying as rising COVID-19 cases threaten to derail the global economic recovery.

“Although the cautious tone by Fed Chair Jerome Powell about the risks of persistent inflation and the need to taper asset purchases was not enough to trigger a sustained recovery in risk sentiment late last week, we look for a limited upside to trade weighed dollar this week,” noted analysts at ING.

“Not only it is a fairly calm week on the US data front (suggesting limited catalysts for a domestically driven USD rally), but the possibly cautious/dovish ECB on Thursday can provide a boost to cyclical FX, which would also spill over into the USD crosses (though EUR/USD would still decline).”

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

Global oil benchmark Brent futures traded 1.54% lower at $72.46 per barrel at the time of writing. Earlier this month, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement. Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 599 points or 1.13% lower at 52,547.89, while the broader NSE Nifty slumped 170.55 points or 1.07% to 15,752.40. Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 466.30 crore, as per exchange data.

USD/INR: Rupee Remains Range-Bound, Likely to Turn Volatile

The Indian rupee opened marginally lower but remained range-bound in lackluster trade against the U.S. dollar in early session Friday amid volatility seen in the domestic equity market.

The dollar to rupee conversion today opened at 74.54 against the U.S. currency, up from Thursday’s close of 74.5375. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened about 19 paise so far in this month.

“The rupee traded in a narrow and tight band throughout the day. Yesterday, it managed to sustain well above 74.50 levels and ended with gains of 4 paise. The Dollar index posted moderate gains. A drop in US weekly jobless claims to a new pandemic low supported gains in the dollar along with hawkish Fed comments,” noted analysts at ICICI Direct.

“The USD to INR is seeing contracting volatility while the trading range has been narrowing for a few sessions. We feel the rupee should move towards 74.4 levels in the coming days whereas upsides seem limited. The dollar to rupee July contract on the NSE was at 74.65 in the last session. The open interest fell 3.2% for the July series.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.05% lower at 92.583 – not far from its three-month high of 92.844.

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

Global oil benchmark Brent futures traded nearly flat at $73.48 per barrel at the time of writing. Last week, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement. Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 25.4 points or 0.05% higher at 53,188.10, while the broader NSE Nifty advanced 12.75 points or 0.08% at 15,936.00. Foreign institutional investors were net sellers in the capital market on Thursday as they offloaded shares worth Rs 264.77 crore, as per exchange data.

USD/INR: Rupee Opens Higher, Gains 10 Paise In Early Trade

The Indian rupee opened higher, appreciating by over 8 paise against the U.S. dollar in early trade Thursday amid buying seen in the domestic equity market.

The dollar to rupee conversion today fell to 74.4775 against the U.S. currency, down from Wednesday’s close of 74.5825. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened over 15 paise so far in this month.

“The rupee continued to trade in a range and fell by 9 paise to close near 74.58 in the last session. The Dollar index fell marginally from its three-month high as comments on Wednesday from Fed chair Powell sent T-notes yield lower and undercut the dollar when he said the US economy has not yet achieved substantial further progress,” noted analysts at ICICI Direct.

“The USD to INR is lacking volatility and no major OI activity are observed, indicating it would trade in a range of 74.40-74.80 in the coming session. The dollar to rupee July contract on the NSE was at 74.66 in the last session. The open interest rose 0.4% for the July series.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading nearly flat at 92.410 – not far from its three-month high of 92.844.

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

“We updated our currency forecasts to reflect a neutral view on the USD this year and our expectation that it will strengthen next year. The timing of the change from neutral to bullish will depend on the COVID-19 situation and central bank tightening intentions,” noted analysts at UBS.

It is worth noting that sustained foreign fund outflows, higher oil prices and firm U.S. dollar will continue to weigh on the rupee.

Global oil benchmark Brent futures traded 0.74% lower at $74.20 per barrel at the time of writing. Last week, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement. Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 124 points or 0.23% higher at 53,028, while the broader NSE Nifty advanced 32.85 points or 0.20% at 15,885.90. Foreign institutional investors were net sellers in the capital market on Wednesday as they offloaded shares worth Rs 1303.95 crore, as per exchange data.

USD/INR: Rupee Snaps Three-Day Gaining String, Down 12 Paise In Early Trade

The Indian rupee snapped three-day gains, depreciating by over 12 paise against the U.S. dollar in early trade Wednesday as the firm greenback and volatile domestic equities weighed on the battered Asian currency.

The dollar to rupee conversion today rose to 74.6125 against the U.S. currency, up from Tuesday’s close of 74.4925. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened about 29 paise so far in this month.

“The rupee continued to appreciate on the back of positive domestic equities and no major rise in oil prices. The dollar on Tuesday posted moderate gains. A larger-than-expected increase in US June consumer prices pushed T-note yields higher and supported gains in the dollar. Also, weakness in US stock indices on Tuesday spurred some liquidity demand for the dollar. EUR/US$ fell moderately on dollar strength,” noted analysts at ICICI Direct.

“The USD to INR pair is struggling at higher levels. Due to no major move in the Dollar index and strong domestic equities, we feel a move towards 74.4 is expected. The dollar to rupee July contract on the NSE was at 74.61 in the last session. The open interest fell 6% for the July series.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.07% lower at 92.685 – not far from its three-month high of 92.844.

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

Investors are now looking ahead to Fed Chairman Jerome Powell’s testimony before the Senate Banking Committee on Wednesday.

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

“There are 4 reasons why significant USD gains over the next 6-12m look unlikely – (1) Citi’s data momentum indices point in favor of Europe; (2) Whilst the Fed may normalize before the ECB/ BoJ, it is still expected to lag other major CBs (BoC, RBNZ, perhaps even RBA and BoE), that may see relatively tepid USD gains vs. these CBs; (3) Elevated commodity prices to support CAD, AUD and NZD; and (4) In the near term (0-3m), DXY seems to have overshot “fair value” as US real yields continue to fall. But eventual Fed tightening via tapering is expected to put upwards pressure on US real yields which would justify a slightly stronger USD over time,” noted analysts at Citi.

Global oil benchmark Brent futures traded 0.20% lower at $76.35 per barrel at the time of writing. Last week, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement. Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 92 points or 0.16% higher at 52,856.45, while the broader NSE Nifty advanced 23.50 points or 0.15% at 15,835.95. Foreign institutional investors were net buyers in the capital market on Tuesday as they purchased shares worth Rs 113.83 crore, as per exchange data.

USD/INR: Rupee Extends Gains to Third Day Amid Subdued Dollar, Gains 14 Paise In Early Trade

The Indian rupee strengthened for the third straight session, appreciating by over 14 paise against the U.S. dollar in early trade Tuesday as the greenback softened ahead of the release of key U.S. inflation data.

The dollar to rupee conversion today fell to 74.425 against the U.S. currency, down from Monday’s close of 74.57. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened about 10 paise so far in this month.

“The rupee traded flat in the first half. However, it depreciated almost 13 paise in the second half and ended near 74.75 levels. The dollar on Monday posted moderate gains on weakness in EUR/US$ and strength in US$/JPY. EUR/US$ fell after ECB President Lagarde signaled the ECB may begin fresh stimulus measures next year after its PEPP program expires,” noted analysts at ICICI Direct.

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.05% lower at 92.216, edging lower as weak U.S. data and a fresh surge in COVID-19 cases worldwide has sparked concerns that the nascent economic recovery is already running out of steam.

Investors are now looking ahead to U.S. inflation data for June on Tuesday and Fed Chairman Jerome Powell’s testimony before the Senate Banking Committee on Wednesday.

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

“Having been bearish on the dollar since April 2020, this month we feel compelled to outline a more positive medium-term scenario. At the heart of this is the likelihood that the Fed’s exit sequence from ultra-loose monetary policy is more compressed than they would have us believe. ING now sees the first hike in 3Q22,” noted analysts at ING.

“2Q22 is when the dollar should be rallying more broadly – coinciding with some decisive bearish flattening in the US yield curve.”

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

Global oil benchmark Brent futures traded 0.27% higher at $75.36 per barrel at the time of writing. Last week, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement. Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 257 points or 0.49% higher at 52,626.71, while the broader NSE Nifty advanced 74.45 points or 0.47% at 15,766.10. Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 745.97 crore, as per exchange data.

USD/INR: Rupee Opens Higher, Gains 22 Paise In Early Trade

The Indian rupee opened higher, appreciating by over 22 paise against the U.S. dollar in early trade Monday amid buying seen in the domestic equity market.

The dollar to rupee conversion today fell to 74.415 against the U.S. currency, down from Friday’s close of 74.6375. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened about 10 paise so far in this month.

“The rupee reverted 8 paise and ended near 74.62 in the last session. We feel the rupee would remain in a range in the coming days. The dollar fell moderately as a rally in stocks curbed liquidity demand for the dollar. The S&P 500 rallied to a new record high on Friday after China’s central bank boosted liquidity in the financial system by cutting the reserve requirement ratio for banks by -0.5 percentage point to 12.0,” noted analysts at ICICI Direct.

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.06% higher at 92.182, edging lower as weak U.S. data and a fresh surge in COVID-19 cases worldwide has sparked concerns that the nascent economic recovery is already running out of steam.

US Dollar is expected to trade with negative bias amid rise in risk appetite in the global markets. Further, traders will remain vigilant ahead of key economic data from US and US Federal Reserve chairman Powell testimony before House Financial Services Committee and Senate Banking Committee,” noted analysts at Sharekhan by BNP Paribas.

“However, the sharp downside may be cushioned on rise in US treasury yields, divergence in global monetary policies and on concern that spread of highly infectious Delta Variant of the virus may derail the global economic recovery. Moreover, a rapid vaccination program will lead to economic reopening. 159.2 million people or 48% of US population have been fully vaccinated and 184.1 million people or 55.5% of the population have received at least 1 dose.”

Investors are now looking ahead to U.S. inflation data for June on Tuesday and Fed Chairman Jerome Powell’s testimony before the Senate Banking Committee on Wednesday.

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

Global oil benchmark Brent futures traded 0.17% lower at $75.42 per barrel at the time of writing. Last week, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement.

Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 250 points or 0.48% higher at 52,637, while the broader NSE Nifty advanced 76.7 points or 0.49% at 15,766.45.

Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 1,124.65 crore, while domestic institutional investors bought shares worth Rs 106.55 crore, as per exchange data.

USD/INR: Rupee Snaps Two-Day Losing Streak, Gains 9 Paise In Early Trade

The Indian rupee snapped its two-day losing streak in early trade on Friday, appreciating by about 9 paise against the U.S. dollar amid sell-off seen in the equity market.

The dollar to rupee conversion today fell to 74.6150 against the U.S. currency, down from Thursday’s close of 74.705. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened about 30 paise so far in this month.

“Weakness continued in the rupee, which depreciated by another 8 paise and closed at 74.7 levels. A sharp reversal in equities from higher levels triggered more selling. The dollar index posted moderate losses as it retreated from Wednesday’s three-month high. The dollar was weighed down on Thursday by negative carryover from Wednesday’s dovish minutes of the June 15-16 FOMC meeting,” noted analysts at ICICI Direct.

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.03% higher at 92.448 – not far from its three-month high of 92.844.  That was largely driven by the minutes of the Federal Reserve’s June policy meeting which reaffirmed that the U.S. central bank to continue to make progress in scaling back its massive asset purchases as soon as this year.

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

“Inflation has risen strongly in recent months, with the Fed surprising markets at the June meeting with a more hawkish stance. Meanwhile, the June labor market data confirmed that a solid US economic recovery is underway. Against this backdrop, the UBS Chief Investment Office is updating their forecasts to reflect a neutral view on the US dollar this year and strength next year,” noted analysts at UBS.

“Last year’s unprecedented expansion of the US Federal Reserve’s balance sheet has brought about a broad US dollar weakness. This phase is now gradually coming to an end, and CIO expects the next wave of USD appreciation to arrive early next year, or maybe even late this year. CIO, therefore, believes that the time has come to adjust their cyclical USD view.”

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

Global oil benchmark Brent futures traded 0.13% higher at $74.22 per barrel at the time of writing. On Tuesday, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement. Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 121 points or 0.23% lower at 52,442, while the broader NSE Nifty traded 25.05 points or 0.16% lower at 15,702.05. Foreign institutional investors were net sellers in the capital market on Thursday as they offloaded shares worth Rs 554.92 crore, as per exchange data.

USD/INR: Rupee Opens Lower for Second Straight Day, Falls 19 Paise In Early Trade

The Indian rupee opened lower for a second straight day, depreciating by over 19 paise against the U.S. dollar in early trade Thursday as the greenback traded near its highest in the last three months after the Fed minutes reaffirmed taper timeline.

“Among EM currencies, the rupee remained one of the underperformers and again depreciated against the dollar. It ended at 74.62 levels, down almost 8 paise. The dollar index rallied to a three-month high. Signs of strength in the US labour market supported gains. May JOLTS job openings rose to a record,” noted analysts at ICICI Direct.

“The USD to INR pair saw fresh accumulation from lower levels along with the Dollar Index moving to fresh three month’s high indicating a move towards 75 cannot be ruled out. The dollar to rupee July contract on the NSE was at 74.82 in the last session. The open interest rose 1.5% for the July series.”

The dollar to rupee conversion today rose to 74.81 against the U.S. currency, up from Wednesday’s close of 74.615. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened more than 42 paise so far in this month.

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.12% higher at 92.752 – close to its three-month high of 92.844.  That was largely driven by the minutes of the Federal Reserve’s June policy meeting which reaffirmed that the U.S. central bank to continue to make progress in scaling back its massive asset purchases as soon as this year.

The world’s dominant reserve currency, the USD, is expected to rise further over the coming year, largely driven by the Fed’s expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

Global oil benchmark Brent futures traded 0.03% lower at $73.41 per barrel at the time of writing. On Tuesday, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement. Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

The benchmark equity indices BSE Sensex was trading 70 points or 0.12% lower at 52,987.06, while the broader NSE Nifty traded 27.25 points or 0.17% lower at 15,849.90. Foreign institutional investors were net buyers in the capital market on Wednesday as they purchased shares worth Rs 532.94 crore, as per exchange data.

USD/INR: Rupee Opens Weak, Falls Over 22 Paise Against Dollar in Early Trade

The Indian rupee broke its recent recovery trend in the early trading session Wednesday, depreciating by over 22 paise against the U.S. dollar as the greenback found safe-haven demand ahead of Fed’s June meeting minutes amid crude oil prices at a three-year high.

The dollar to rupee conversion today rose to 74.77 against the U.S. currency, up from Tuesday’s close of 74.5425. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened more than 44 paise so far in this month.

“The rupee again depreciated against the USD and slipped almost 24 paise towards the end. The rupee closed at 74.54 levels while a reversal was seen post a sharp sell-off in equities,” noted analysts at ICICI Direct.

“The dollar index on Tuesday saw support ahead of Wednesday’s release of the minutes from the June 15-16 FOMC meeting, which could be hawkish for Fed policy and supportive of the dollar. FOMC members at that meeting began discussions of QE tapering.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading nearly flat at 92.54 – pulling back from three-month highs as rate hikes bets ebbed.

Investors will watch minutes from the Fed’s latest meeting – due on Wednesday – after the Fed brought forward its policy tightening timeline and surprised markets last month.

But the world’s dominant reserve currency, the USD, is expected to rise over the coming year, largely driven by the Fed’s dot plot released last week, which suggested an expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

The benchmark equity indices BSE Sensex was trading 26.23 points or 0.05% higher at 52,888.09, while the broader NSE Nifty traded nearly flat at 15,818.85.

It is worth noting that sustained foreign fund outflows, higher oil prices and firm U.S. dollar will continue to weigh on the rupee.

However, foreign institutional investors were net sellers in the capital market on Tuesday as they offloaded shares worth Rs 543.3 crore, as per exchange data.

Global oil benchmark Brent futures traded 0.03% lower at $74.52 per barrel at the time of writing. On Tuesday, oil prices spiked to a three-year high of $77.84 per barrel as OPEC+ failed to reach an agreement.

Higher oil prices would push up the inflation expectations and widen India’s trade deficit, which could hurt the Indian rupee.

USD/INR: Rupee Opens Higher for Second Straight Day, Gains 5 Paise In Early Trade

The Indian rupee opened higher for the second straight day, appreciating by over 5 paise against the U.S. dollar in an early trade Tuesday, helped by a subdued greenback which took a breather after last week’s U.S. jobs data.

Investors will watch minutes from the Fed’s latest meeting – due on Wednesday – after the Fed brought forward its policy tightening timeline and surprised markets last month.

The dollar to rupee conversion today fell to 74.2475 against the U.S. currency, down from Monday’s close of 74.3. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened about 8 paise so far in this month.

“After six days of continuous fall, the rupee managed to recover and appreciated almost 44 paise to close at 74.30 levels in the previous session. The Dollar index remained marginally below its recent two-month high post unemployment data. We continue to feel the Dollar index would remain in a range before making a directional move from here,” noted analysts at ICICI Direct.

“The USD to INR reverted from its sizeable Call base of 75. We feel it is likely to trade in a range as no major moves are expected from the Dollar index due to the holiday season. The dollar to rupee July contract on the NSE was at 74.48 in the last session. The open interest fell 4% for the July series.”

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the rupee.

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.07% lower at 92.150 – pulling back from three-month highs as rate hikes bets ebbed.

But the world’s dominant reserve currency, the USD, is expected to rise over the coming year, largely driven by the Fed’s dot plot released last week, which suggested an expectation of two rate hikes in 2023.

A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected would push the USD to INR pair higher.

It is worth noting that the U.S. markets were closed on Monday in observation of Independence Day.

The benchmark equity indices BSE Sensex was trading 79.56 points or 0.16% higher at 52,958.20, while the broader NSE Nifty advanced 35.70 points or 0.23% to 15,870.35.

However, foreign institutional investors were net sellers in the capital market on Monday as they offloaded shares worth Rs 338.0 crore, as per exchange data. Global oil benchmark Brent futures rose 0.43% to $77.49 per barrel.

USD/INR: Rupee Snaps Four-Day Losing Streak, Gains 24 Paise In Early Trade

The Indian rupee snapped its four-day losing streak in the early trade on Monday, appreciating by about 24 paise against the U.S. dollar as the greenback took a breather after last week’s U.S. jobs data soothed jitters about the timing of policy normalisation.

The dollar to rupee conversion today fell to 74.5 against the U.S. currency, down from Friday’s close of 74.74. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened over 17 paise so far in last three trading sessions.

“We keep the trajectory for USD/INR (USD to INR pair) but calibrated the forecasts higher. The damage of the second wave has started to sink in, amplified by the downgrades in growth forecasts by credit rating houses (S&P and Moody’s) for FY22. Key move to contain damage to the economy within 2Q at this point is to ramp up vaccination rates and India has moved to approve the 4th vaccine for emergency use – Moderna. The first three vaccines approved were Covishield, Covaxin and Sputnik V. There are signs that vaccine supply shortage has eased recently,” noted analysts at Maybank

“According to a set of government data released on 29 Jun, the total number of vaccines administered in the last two weeks has exceeded the number of people who registered for vaccines in the same period. The pace of inoculation was slower in May when the federal government wanted to leave vaccine purchase to the states. But since last week, the Federal government has taken up the responsibility of supplying vaccines to all states, thereby improving the speed of procurement and vaccinations.”

It is worth noting that sustained foreign fund outflows, higher oil prices and firm U.S. dollar will continue to weigh on the rupee.

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.11% higher at 92.324 – pulling back from three-month highs as rate hikes bets ebbed.

The dollar is expected to rise over the coming year, largely driven by the Fed’s dot plot released last week, which suggested an expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected push the USD to INR pair higher.

It is worth noting that the U.S. markets are closed on Monday in observation of Independence Day.

The benchmark equity indices BSE Sensex was trading 349.62 points or 0.67% higher at 52,839.60, while the broader NSE Nifty advanced 99.40 points or 0.63% to 15,821.55.

However, foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 982.80 crore, as per exchange data. Global oil benchmark Brent futures fell 0.12% to $76.09 per barrel.

USD/INR: Rupee Hit Weakest Since April 26; Downside Risks Remain

The Indian rupee hit its weakest since April 26, depreciating by over 18 paise against the US dollar in early morning trade Friday amid weakness in domestic equity markets.

The dollar to rupee conversion today rose to 74.745 against the U.S. currency, up from Thursday’s close of 74.5625. The rupee has lost over 170 paise in June – posting the biggest monthly drop since March 2020, the early days of the pandemic, and weakened over 34 paise in the last two trading sessions.

“The Indian Rupee is expected to trade with negative bias amid strong dollar and muted domestic market sentiments. Further, Rupee may slip on disappointing macroeconomic data and surge in crude oil prices. Moreover, traders will remain vigilant ahead of Organization of the Petroleum Exporting Countries and its allies meeting outcome and US Job data,” noted analysts at Sharekhan by BNP Paribas.

“Furthermore, market participants are worried that spread of highly infectious Delta Variant of virus may derail global economic recovery. However, sharp fall may be prevented as number of COVID-19 cases in India continued to decline. India reported daily new COVID-19 cases below 50K mark for 4th consecutive day. The USD to INR spot expected to trade in a range between 74.30 on lower side to 74.75 on higher side with upward trend.”

It is worth noting that sustained foreign fund outflows, higher oil prices and firm U.S. dollar will continue to weigh on the rupee.

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.05% lower at 92.555 – rose to a 2-1/2-month peak on Wednesday, posting its biggest monthly rise since November 2016.

The dollar is expected to rise over the coming year, largely driven by the Fed’s dot plot released last week, which suggested an expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected push the USD to INR pair higher.

US Dollar is expected to trade with positive bias on expectation of improved economic data from US. US Job reports are likely to show that labor market is recovering. US Non-Farm Payrolls data is forecasted to show that number of jobs added in economy in June 2021 increased to 700K compared to preceding month. Market participants fear that strong labor market and rising inflation pressure may force Federal Reserve to start reducing monetary stimulus sooner rather than later,” Sharekhan’s analysts’ added.

“Moreover, Dollar may gain strength on divergence in global monetary policies and on concern that spread of highly infectious Delta Variant of virus may derail global economic recovery. Furthermore, rapid vaccination program will lead to economic reopening.  However, sharp upside may be capped on rise in risk appetite in the global markets and decline in US treasury yields. Further, Fed Officials differ in view on how long inflation is likely to stay high and when to tighten monetary policy.”

The benchmark equity indices the BSE Sensex was down 54 points or 0.10% at 52265.93, and the Nifty was down 13.55 points or 0.09% at 15667.00.

However, foreign institutional investors were net sellers in the capital market on Thursday as they offloaded shares worth Rs 1,245.29 crore, as per exchange data. Global oil benchmark Brent futures fell 0.22% to $75.67 per barrel.

USD/INR: Rupee Extends Losses; Further Depreciation Likely

The Indian rupee opened on a weaker note, depreciating by 5 paise against the US dollar in early morning trade Thursday as higher oil prices and a stronger greenback continued to pressurise the battered Asian currency.

The dollar to rupee conversion today rose to 74.375 against the U.S. currency, up from Wednesday’s close of 74.325. The rupee has lost over 170 paise so far this month and weakened over 14 paise in the last four trading sessions.

“The rupee weakened further against the US dollar and closed at 74.32 levels, down 10 paise. A sharp sell-off in domestic equities can be attributed to the fall. The dollar found support Wednesday on quarter-end demand along with safe-haven demand from the spread of the dangerous Delta COVID-19 variant throughout the world. The dollar extended its gains on Wednesday on mostly better-than-expected US economic data,” noted analysts at ICICI Direct.

It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the domestic unit.

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.02% lower at 92.422 – not from a two-and-a-half-month top of 92.451 reached on Wednesday.

“After being a USD bear in recent years, we now see USD strengthening gradually into 2022 as FED starts tapering, lifting the Dollar Index (DXY) higher above 93,” noted analysts at UOB.

The dollar is expected to rise over the coming year, largely driven by the Fed’s dot plot released last week, which suggested an expectation of two rate hikes in 2023. A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected weighed on the rupee.

Mitul Kotecha, Senior EM Strategist at TD Securities said in an interview with CNBC that the USD to INR pair could be around Rs 75 per dollar.

The benchmark equity indices the BSE Sensex was down 12 points or 0.2% at 52475.84, and the Nifty was up 4.5 points or 0.03% at 15725.55.

However, foreign institutional investors were net sellers in the capital market on Wednesday as they offloaded shares worth Rs 1,646.66 crore, as per exchange data. Global oil benchmark Brent futures rose 0.16% to $74.74 per barrel.

USD/INR: Rupee Opens Marginally Lower; May Lose Further

The Indian rupee opened on a weaker note, depreciating by over 5 paise against the US dollar in early morning trade Wednesday as oil prices rose for the second straight day and the greenback continued to hover below a two-month high against its rivals.

The dollar to rupee conversion today rose to 74.2725 against the U.S. currency, up from Tuesday’s close of 74.22. The rupee has lost over 165 paise so far this month and weakened over 7 paise in the last three trading sessions. It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the domestic unit.

“The rupee has been trading in a tight range for a couple of sessions. Yesterday, the rupee depreciated by 3 paise against the dollar as weakness in domestic equities continued for a second day,” noted analysts at ICICI Direct.

“The dollar index witnessed safe-haven buying as more countries are expected to impose fresh lockdown post spread in the Delta virus. The dollar index is likely to move towards 92.5 levels in coming weeks.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.1% higher at 91.005 – not from a two-month high of 92.408.

The dollar is expected to rise over the coming year, largely driven by the Fed’s dot plot released last week, which suggested an expectation of two rate hikes in 2023. That would push the USD to INR pair further up.

A strengthening dollar and growing risk that the Federal Reserve would tighten its monetary policy earlier than expected weighed on the yellow metal. Gold prices fell about 0.14% to $1,758.56.

The benchmark equity indices the BSE Sensex was up 219 points or 0.42% at 52764.82, and the Nifty was up 61.65 points or 0.40% at 15813.40.

However, foreign institutional investors were net buyers in the capital market on Tuesday as they purchased shares worth Rs 116.63 crore, as per exchange data.

Global oil benchmark Brent futures rose 0.41% to $75.07 per barrel an industry report showed U.S. crude stockpiles declined last week.

USD/INR: Rupee Slips Over 8 Paise in Early Trade; Weakness Could Persist

The Indian rupee opened on a weaker note, depreciating by over 8 paise against the US dollar in early morning trade Tuesday as the greenback hovered below a two-month high versus its major counterparts.

The dollar to rupee conversion today rose to 74.275 against the U.S. currency, up from Monday’s close of 74.19. The rupee has lost over 160 paise so far this month and weakened over 5 paise in the last trading sessions. It is worth noting that sustained foreign fund outflows, higher oil prices, and firm U.S. dollar will continue to weigh on the battered Asian currency.

“For a major part of the day the rupee lacked momentum and ended almost flat at 74.19 levels. Hawkish Fed comments on Monday helped the Dollar index to move slightly higher while dovish ECB comments undercut the EURUS$. We feel the Dollar index should find support near 91.5 levels,” noted analysts at ICICI Direct.

“Weakness in the rupee should continue as crude oil prices moved to 2018 highs. Huge writing positions were formed even in OTM Puts for the July series, which should provide support to the USD to INR pair. The dollar to rupee June contract on the NSE was at 74.43 in the last session. The open interest rose 26.3% for the July series.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.07% higher at 91.947 – not from a two-month high of 92.408. The dollar is expected to rise over the coming year, largely driven by the Fed’s dot plot released last week, which suggested an expectation of two rate hikes in 2023.

“The dollar extended gains in the previous session as US Treasury yields rose after the US core PCE price index rose to 3.4%, the highest level since 1991. We see range trading until the outcome of the US labour market report that is due on Friday,” noted analysts at ICICI Bank.

A strengthening dollar and growing worry that the Federal Reserve would tighten its monetary policy earlier than expected weighed on the yellow metal. Gold prices fell about 0.4% to $1,774.15.

The benchmark equity indices the BSE Sensex was down 164.78 points or 0.32% at 52567.10, and the Nifty was down 56.55 points or 0.35% at 15759.80.

However, foreign institutional investors were net sellers in the capital market on Monday as they offloaded shares worth Rs 1,658.72 crore, as per exchange data. Global oil benchmark Brent futures fell 0.52% to $74.29 per barrel.

USD/INR: Rupee Falls in Early Trade; Downside Risk Still High

The Indian rupee opened on a weaker note against the US dollar in early morning trade Monday as high oil prices and firm greenback continued to put pressure on the battered Asian currency.

The dollar to rupee conversion today rose to 74.255 against the U.S. currency, up from Friday’s close of 74.20. The rupee has lost over 160 paise so far this month and weakened about 35 paise last week.

“The USD to INR continued to trade above 74 levels supported by a recent dollar index upside and rising crude oil prices. As long as the dollar trades above 91.20 level and oil prices remain elevated that may keep the rupee under pressures. The US$INR pair should move towards 74.6 levels in coming days,” noted analysts at ICICI Direct.

“The dollar-rupee June contract on the NSE was at 74.31 in the last session. The open interest fell 7.1% for the June series.”

The dollar index, a measurement of the dollar’s value relative to six foreign currencies, was trading 0.01% higher at 91.859. The dollar is expected to rise over the coming year, largely driven by the Fed’s dot plot released last week, which suggested an expectation of two rate hikes in 2023.

“The US dollar is expected to trade with negative bias amid Fed Officials differing view on how long inflation is likely to stay high and when to tighten monetary policy. Further, softer than expected economic data from US will continue to hurt Dollar. Additionally, traders will remain cautious ahead of FOMC official’s statement on inflation and interest rates. Moreover, market sentiments may improve as US President Joe Biden and a group of senators agreed roughly $1 trillion infrastructure plan securing bipartisan deal,” noted analysts at Sharekhan by BNP Paribas.

“However, sharp downside may be cushioned on divergence in global monetary policies and rise in geopolitical tensions. U.S conducted airstrikes in Syria and Iraq against two Iranian backed militias that were mounting drone attacks against U.S troops. Furthermore, rapid vaccination program will lead to economic reopening. 153.02 million People or 46.1% of US population have been fully vaccinated and 179.2 million people or 54% of population have received at least 1 dose.”

The yellow metal prices increased as the dollar weakened marginally and lower-than-forecast U.S. inflation data diminished fears of an early monetary policy tightening by the U.S. Federal Reserve.

The benchmark equity indices the BSE Sensex was down 13.10 points or 0.02% at 52911.94, and the Nifty was up 1.50 points or 0.01% at 15861.90.

However, foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 678.84 crore, as per exchange data. Global oil benchmark Brent futures fell 0.14% to $76.07 per barrel.