USD/INR opens up on likely FII outflows from local stocks, rising crude oil prices

31 July 2019 / Morning Brief

Indian Rupee

• The Indian rupee little changed at 68.90 pair now at 68.93 against 68.86 previous close.
• Pair to tip in 68.70-69.00 range today.
• Dollar/rupee opened higher Wednesday on likely overseas outflows from local stocks amid rising crude oil prices. Mainly local equities are negative and FII outflows are there supporting dollar demand. Few oil importers are on the buy side as Brent is above $65/bbl. Globally fresh worries over US-China trade war after threats from US President Donald Trump reduced risk appetite. Investors now await interest rate decision from the US Federal Reserve. Crude oil prices extended gains on optimism the Federal Reserve will deliver a rate cut when it concludes its policy meeting later tomorrow.

Global Currency

• The dollar held steady on Wednesday, largely in a wait-and-see mode as traders looked ahead to the outcome of the Federal Reserve's meeting later in the day when policymakers are expected to cut interest rates for the first time since 2008.
• Sterling GBP=D4 was 0.1% higher at $1.2157, crawling back from a 28-month trough of $1.2120 plumbed on Tuesday. Troubles for the currency, which has lost 4.3% in July, were still seen to be far from over as Britain's new prime minister Boris Johnson took over with the explicit agenda of pulling the country out of the EU by Oct. 31, whether transitional trading agreements are in place or not.

Global Markets

• Oil prices rose for a fifth day on Wednesday, buoyed by a bigger than expected drop in U.S. inventories and as investors awaited a widely expected cut in interest rates by the Federal Reserve, the first in more than 10 years.
• Gold was mostly unchanged in early Asian trade on Wednesday as investors awaited the outcome of a U.S. Federal Reserve meeting at which policymakers are expected to cut interest rates for the first time since the financial crisis.

Global Markets at one Glance

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