![]() ![]() Today's moves extended dollar gains made on Friday when US Federal Reserve Chair Jerome Powell warned there'd be "some pain" for households and businesses as it will take time for the Fed to control inflation. ![]() The dollar index scaled to a fresh two-decade peak of 109.4 in early Asia trade, with greenback strength pushing other major currencies to new lows and putting pressure on its emerging markets counterparts. However, this may not alter the trajectory of the pair and the path of least resistance would remain upward," added Mr Banerjee. This means they may continue to sell USD as the spot and forwards moves to a fresh all-time high. "The RBI has twin objectives of not letting the rupee become a weak outlier and also, they do not want the USDINR to become too volatile. ![]() However, the speed of the up move will be closely regulated by RBI," he said. "A strong US dollar Index, high US bond yields with an deeply inverted yield curve and weak equity markets all makes it challenging for FPI and carry trade flows in EMs. In a note, “rupee breaches 80/$ mark" said Anindya Banerjee, VP for Currency Derivatives & Interest Rate Derivatives at Kotak Securities. The next important events are PMI and NFPR of the US which will give an indication as to how the economy and labour markets are behaving," Mr Bhansali said.īloomberg quoted the rupee at 80.0363 compared to its previous close of 79.8712.īut analysts said, foreign portfolio investments and the Reserve Bank of India could limit the rupee's damage. "With 80 being allowed to be crossed over by RBI, its actions will be watched closely by traders. According to Anil Kumar Bhansali, Head of Treasury, Finrex Treasury Advisors, the rupee opened on a weak note after a hawkish Mr Powell kept US rate hikes in prominence until inflation falls to 2 per cent. ![]()
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