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Senior Iranian officials said that no deal has been reached with the United States (US), but gaps have been narrowed, Reuters reported on Friday. However, Islamic Republic’s Supreme Leader, Mojtaba Khamenei, stated that Iran’s uranium enrichment and Tehran’s control over the Strait of Hormuz remain among the sticking points.Market reactionAt the time of writing, the West Texas Intermediate (WTI) is down 0.41% on the day at $96.83. WTI Oil FAQs WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is…
Mumbai: The Indian rupee, under the cosh for 10 straight days, Thursday rebounded against the dollar in the spot market to log its steepest gains in a fortnight after what dealers described as unusually heavy central bank interventions to support the currency. Talk that policymakers might even raise interest rates buttressed the rupee, which outshone peers in the continent to emerge as the strongest Asian performer against the dollar Thursday. The local unit closed at 96.20 per dollar in the Mumbai spot market against the previous close of 96.82. Traders reported heavy dollar sales by state-run banks, likely on behalf…
Arvind Panagariya has advised the RBI to allow the rupee to depreciate naturally instead of aggressively defending the ₹100-per-dollar level amid rising oil prices and external pressures. | Photo Credit: SANDEEP SAXENA Economist Arvind Panagariya has urged the Reserve Bank of India not to allow the “psychology” surrounding the rupee breaching the 100-per-dollar mark to dictate its policy response, arguing that depreciation is the appropriate response to a spike in oil-related external pressures.“Whether the oil shortage is short-lived or long-lived, the right response at this moment is to let the rupee depreciate,” said the chairman of the 16th Finance Commission,…
Standard Chartered Bank economists Anubhuti Sahay and Saurav Anand now expect the Reserve Bank of India’s repo rate to rise by 50bps to 5.75% in FY27, starting in June. They link this to a higher FY27 CPI forecast of 4.9%, INR depreciation and global yield pressures, and flag additional upside risks to rate hikes if commodity prices and INR weakness persist.Standard Chartered revises FY27 rate path”We revise our repo rate forecast to a cumulative 50bps of hikes to 5.75% in FY27 (year ending March 2027), from our earlier status quo call of 5.25%. This reflects an upward revision to our…
OCBC’s FX Strategist Christopher Wong notes the Dollar Index eased as lower UST yields and softer Oil prices reduced safe-haven demand, with the Federal Open Market Committee (FOMC) minutes adding no new hawkish impulse. He highlights ongoing bullish daily momentum but signs of an overbought reversal. US Dollar Index (DXY) is consolidating, with resistance around 99.40 and 100.50/60 and support clustered between 98.30 and 97.50.Dollar rebound loses some momentum”USD eased overnight, taking cues from softer yields while oil prices slipped. The FOMC minutes offered no major surprises. The Fed still sounded patient, with officials focused on inflation risks and not…
The Indian rupee rose on Thursday, its first day of gains in two weeks, after the central bank shored up the currency through firm intervention, while a media report that policy options including a potential rate hike are being weighed for its defence also helped. The rupee closed at 96.20, up 0.6% from its close at 96.82 in the previous session, its best one-day gain in two weeks. The Reserve Bank of India deployed a familiar intervention strategy on Thursday, conducting heavy dollar sales via state-run banks before market open to halt a persistent slide in the rupee after a…
The rupee recovered from 100 per US dollar in forward market and was trading at 96.43 on Thursday after US President Donald Trump indicated that negotiations with Iran were entering the final stages.The one-year forward market rate for the rupee touched the crucial 100/USD mark on Wednesday, indicating that currency markets are pricing in a weakening bias for the USD/INR pair over the next 12 months, forex traders said.Investors are still gauging the geopolitical risk and oil price sensitivity in the background, with any flare-up in the West Asia tensions or spikes in crude, they added.At the interbank foreign exchange…
Standard Chartered’s Nicholas Chia argues that softer Australian labour data and activity indicators support the view that the Reserve Bank of Australia has likely peaked its cash rate at 4.35%. The bank highlights rising unemployment, weaker PMI and moderating wage growth, and sees a high bar for further hikes, with potential easing only if activity deteriorates sharply.Softer labour data ease RBA pressure”Australia’s unemployment rate rose 0.21ppt to 4.49% in April, the highest since late-2021. This follows the May decline of the flash services PMI (47.7) into contractionary territory, and Q1 wage growth easing to 3.3% y/y, in line with the…
The USD/JPY pair trades calmly around 159.00 during the Asian trading session on Thursday. The pair turns sideways as investors await fresh developments regarding negotiations between the United States (US) and Iran, after President Donald Trump stated on Wednesday that talks are in “final stages”.As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades marginally higher to near 99.20. The DXY’s rally hit pause on Wednesday after posting a fresh six-week high at 99.47, following US President Trump expressing confidence that a deal with Iran would be finalized soon.We’re in the final…
The U.S. dollar hovered below a six-week peak on Thursday after pulling back on rising hopes that Washington is nearing a deal with Tehran to end the war in the Middle East. U.S. President Donald Trump said negotiations were in the final stages, while also warning of further attacks if Iran does not agree to a deal. The dollar, a traditional safe haven, fell for the first time in eight sessions against the yen on Wednesday, and was down slightly at 158.905 yen in early Thursday trading – taking it back from the 160 level that traders and analysts view…