- The edges of the Indian rupee are lower in the Asian session on Tuesday.
- Fresh foreign capital flows and the weakest dollar supports inr; High crude oil prices may break the rise.
- Investors invest the consumer confidence report at Fedspeak and CB later on Tuesday.
Indian rupee (INR) will be reduced on Tuesday after closing it stronger in the ninth session in a row in the previous session. US dollar sales (USD) from foreign banks and a mark in foreign flows provide some support to the Indian currency, which helps to return all its losses in 2025 until now.
However, the rise in crude oil prices may exert some pressure on the local currency. It should be noted that India is the third largest oil consumer in the world and the rise in crude oil prices until it has a negative impact on the value of INR. Fedspeak merchants, along with a consumer confidence scale in the Conference Council, new home sales and Richmond Fed Manufacturing, which will be published later on Tuesday.
Indian rupee loses the land on the high prices of crude oil
- The HSBC India Manufacturing Purchaseing Managers (PMI) rose to 57.6 in March from 56.3 in February.
- PMI fell Indian services to 57.7 in March compared to 59.0 before. The compound participation managers index fell to 58.6 in March from 58.8 in February.
- “The manufacturing sector in India has expanded a faster pace in March … the output index has risen to its highest level since July 2024,” said Brangul Bahandari, the chief economist in India in HSBC.
- Trump said late on Monday that he will announce the definitions of car imports in the coming days, and indicated that some countries will receive rest periods from mutual definitions on April 2.
- Trump also stated that he intends to move forward with the customs tariffs of the sector on wood and semi -conductors and reiterated his threat to impose duties on pharmaceutical drugs “in the very near future.”
- The head of the Federal Reserve in Atlanta Rafael Bustic has warned that economic uncertainty will continue to make decisions in the field of federal reserve as the US -afflicting trade war continues to pressure the economy.
- The USS & P Global Composite Manager Index rose to 53.5 (preliminary) in March from 51.6 in February. Meanwhile, the Industry of Manufacturing Directors Index decreased to 49.8 in March compared to 52.7 before, and a loss of 51.9. PMI Services rose to 54.3 in March from 51.0 in previous reading, above the market consensus of 51.2.
Usd/INR resumes the negative side journey at the bottom of EMA for 100 days
Indian rupee is trading a weaker note per day. The USD/Inr husband resumes its negative side, as the price crosses less than 100 days moving average on the daily chart. However, the 14 -day relative indicator (RSI) is less than 30.00 brands warning against dumpling merchants, which may indicate a temporary recovery or more monotheism in the near term.
The first goal is on the negative side of the US dollar/INR in 85.60, the lowest level on January 6. The 84.84 losses, the lowest level on December 19, 202, may be revealed. This level may witness a decrease to 84.22, the lowest level on November 25, 2024.
On the bright side, the level of the decisive resistance of the husband appears in the area of 85.95-86.00, which represents the psychological and EMA level for 100 days. The next obstacle is 86.48, the lowest level on February 21, on its way to 87.00, round shape.
Indian rupee questions and answers
Indian rupee (INR) is one of the most sensitive currencies for external factors. The price of crude oil (the country depends greatly on imported oil), and the value of the US dollar – most trade in US dollars – and the level of foreign investment are all influential. The direct intervention by the Indian Reserve Bank (RBI) in the foreign currency markets to maintain the exchange rate is stable, as well as the level of interest rates that RBI has placed, significant impressive factors in the rupee.
The Indian Reserve Bank (RBI) is actively interfering in the Forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, RBI tries to keep the inflation rate in its goal by 4 % by setting interest rates. High interest rates usually enhance rupee. This is due to the role of “Trade Trade” in which investors in countries that have lower interest rates are borrowed in order to put their money in countries “that provide relatively higher interest rates and profit from the teams.
The total economic factors that affect the value of rupees include inflation, interest rates, economic growth rate (gross domestic product), trade balance, and flows from foreign investment. A higher growth rate can lead to more investment abroad, which increases the demand for rupee. The less negative trade balance will eventually lead to a stronger rupee. High interest rates, especially real prices (less inflationary interest rates) are also positive for rupee. The risk environment can lead to increased direct and indirect foreign investment flows (FDI and FII), which also benefits rupee.
The highest inflation, in particular, if it is relatively higher than its peers in India, is generally negative for the currency because it reflects the reduction in the value of the currency. Inflation also increases the cost of exports, which sells more rupees to buy foreign imports, which is negative rupee. At the same time, high inflation usually raises the Indian Reserve Bank (RBI) interest rates, and this may be positive for rupee, due to increased demand from international investors. The opposite effect applies to low inflation.
