USD/INR open down as US agrees to roll out currency pact with China, crude oil prices falls

10 October 2019 / Morning Brief

Indian Rupee

• The Indian rupee little changed at 70.95 pair now at 70.97 against 71.07 previous close.
• Pair to tip in 70.80-71.10 range today.
• Dollar/rupee opened lower Thursday on US optimism over a preliminary currency pact as part of partial trade deal amid lower crude oil prices. The US is optimistic over currency pact with China in the on going trade talks. Also, lower crude oil prices weighed on spot pair. It may suspend the planned tariff hike next week, while lower level talks held previously between US and Chinese officials aimed to create a good atmosphere for the upcoming meeting.

Global Currency

• Currencies whipsawed on Thursday as news suggesting division, then detente in Sino-U.S. trade talks sparked volatility, with riskier Asian currencies ultimately rallying over a sinking dollar. Investors parsing headlines for any clues that tensions weighing on global growth could be resolved, turned from downcast to bullish after Bloomberg reported a currency pact could be part of a deal suspending further tariff hikes. Yuan CNH= the most sensitive currency to the trade war, bounced to a two-week high from a month-low in offshore trade, gaining 0.3% by mid-session and pulling the trade-exposed.
• The pound climbed to $1.2228, though it remains close to a one-month low and weighed down by uncertainty over Britain's exit from the European Union, as hopes for progress on a key sticking point were dashed overnight.

Global Markets

• Oil prices fell on Thursday on concerns of lower fuel demand as talks this week between the United States and China, the world's two largest oil users, are not expected to help end the trade war between them, adding to anxieties about the global economy
• Gold prices scaled a one-week peak on Thursday as diminishing hopes of progress at the ongoing Sino-U.S. trade talks sent stock markets lower and prompted investors to seek bullion's safety.

Global Markets at one Glance

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