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The Indian rupee weakened slightly on Wednesday but held off pressure from dollar demand linked to maturing non-deliverable forwards and foreign portfolio outflows, as the central bank intervened to support the currency.The rupee hovered near its record low of 93.98 per dollar through the session before closing at 93.9775, down 0.1%.Indian stocks rose after Brent crude fell below $100 a barrel, but the rupee struggled to benefit as interbank traders and importers bought dollars.A series of NDF maturities, including Wednesday’s, is expected to keep the rupee under pressure over the next week, a trader at a private bank said.Indian stocks…
Deutsche Bank’s Chief UK Economist Sanjay Raja notes that UK inflation data broadly matched expectations, with Headline CPI at 3% and stronger Services CPI driving a firmer Core CPI outcome. He warns that rising fuel, energy and input costs are likely to push CPI back towards 3.5% year-on-year, undermining prospects for Bank of England rate cuts in 2024 and even raising the risk of renewed hikes.Rising energy costs threaten disinflation path”UK inflation came broadly as expected. Headline CPI printed at 3%, with core CPI coming in a touch stronger than consensus expectations (though in line with our own projection). Why…
The Indian central bank likely intervened to support the rupee on Wednesday as heavy dollar demand linked to maturing non-deliverable forwards (NDFs) that it had relied on to manage volatility in the currency, blunting relief from a pullback in oil prices. The likely intervention via state-run banks, traders said, helped the South Asian currency hold above its record low of 93.98 per dollar to last quote at 93.96, down 0.1% on the day. “To prevent a more rapid slide in the rupee, the RBI continues to intervene in the FX market through both spot and forwards. As the NDFs mature,…
The UK Office for National Statistics (ONS) will release the February Consumer Price Index (CPI) figures on Wednesday at 07:00 GMT, a print that will matter for markets. Consensus expectations point to inflation pressures keeping their grasp on the economy.UK consumer inflation remains one of the most important inputs for the Bank of England (BoE) and typically carries real weight for the British Pound (GBP). Following the latest hawkish hold by the BoE on March 19, investors now anticipated the ‘Old Lady’ to hike its policy rate at its April 30 gathering.What to expect from the next UK inflation report?Headline…
The Australian Bureau of Statistics (ABS) will release the Consumer Price Index (CPI) for February on Wednesday at 00:30 GMT, with inflation expected to hold steady at 3.8% YoY and come in flat on a monthly basis. This release comes as the Reserve Bank of Australia (RBA) has already raised its key rate to 4.10%, highlighting concerns over persistent inflation. Policymakers remain focused on potential second-round effects, while markets increasingly anticipate another rate hike in the coming months.Meanwhile, geopolitical developments are playing a growing role in inflation expectations. Escalating tensions in the Middle East and disruptions to energy supply routes…
USD/JPY trades around 158.70 on Tuesday at the time of writing, up 0.16% on the day, supported by a US Dollar (USD) that maintains a bullish bias amid ongoing geopolitical and economic uncertainty.The US Dollar Index (DXY), which measures the Greenback against a basket of six major currencies, is holding near 99.30 after easing from 99.50, reflecting sustained demand for the US currency. Escalating tensions in the Middle East continue to drive safe-haven flows while fueling concerns about a broader global economic slowdown.In the United States (US), the latest preliminary S&P Global Purchasing Managers Index (PMI) data highlight a loss…
Commerzbank’s Senior Economist Dr. Vincent Stamer notes that the Euro area composite PMI fell from 51.9 to 50.5 in March, with services weakening and manufacturing flattered by longer delivery times. He links this to the war in Iran, which is hurting expectations and lifting input prices. Despite the March drop, PMI levels still historically align with moderate Euro area growth.Services weaken as manufacturing distorted higher”The composite Purchasing Managers’ Index (PMI) for the manufacturing and services sectors in the euro area fell from 51.9 to 50.5 points in March. The war in Iran appears to make itself felt: while expectations in…
The Indian rupee paused a three-day run of hitting record lows to nudge higher on Tuesday as traders parsed dissonant signals emanating from Washington and Tehran about a potential resolution to the conflict in the Middle East. The rupee nudged up 0.1% to end the session at 93.8650, from its close at 93.9750 in the previous session. The currency has weakened about 4% in 2026 so far, with a large chunk of losses coming in March as oil prices surged and foreign investors yanked money from local stocks, unnerved by the war in the Middle East.Analysts at Goldman Sachs pared…
The gap between offshore swaps used to wager on India’s policy rates and those that reflect the cost of hedging against a weaker rupee is widening, hinting at worries over the currency’s outlook as the Iran war threatens the net energy importer.The one-year non-deliverable overnight index swap (NDOIS), a key gauge for India’s policy rate expectations, has climbed 50 basis points since the Middle East conflict started.The one-year dollar/rupee non-deliverable currency swap, which factors in the cost of hedging rupee exposure, has jumped more than 90 bps, reflecting pressure from hedging and speculative flows.The spread between the rates has widened…
The Indian Rupee (INR) strives to regain ground against the US Dollar (USD) during afternoon trading hours in India on Tuesday, following an underperformance in the opening trade. The USD/INR drops to near 94.15 from the morning high of 94.30 as the US Dollar gives back its early gains amid improvement in investors’ risk-appetite.As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, is marginally up to near 99.20 after surrendering almost its entire early gains. S&P 500 futures have recovered its entire early losses and have turned positive around 6,600.00, indicating an…