India Rupee Opened Lower Tracking Peers; US-China Tensions Mount

India Rupee Opened Lower Tracking Peers; US-China Tensions Mount

22 May 2020 10:09 AM
 

USD/INR

India rupee opened lower at 75.72 against its last close of 75.6050. The Indian rupee traded lower against the dollar tracking losses in regional equities and currencies after China moved to increase control over Hong Kong, prompting U.S. lawmakers to propose sanctions. In India, the death toll climbed to more than 3,500 and the number of identified cases reached 116,000. This week, more than 20,000 new coronavirus cases have been diagnosed. Dollar index up 0.1% at 99.50, adding to yesterday’s 0.2% rise. Benchmark Brent crude oil contract 2% lower at $35.32 per barrel. Yesterday, the contract reached a more than two-month high of $36.98.

EUR/USD

It’s a particularly quiet day ahead on the economic calendar. There are no material stats to provide the EUR with direction. On the monetary policy front, the ECB monetary policy meeting minutes are due out later today and will draw some interest. The markets will be looking for what the ECB has left to offer by way of support. Renewed tensions between the U.S and China remains negative for the EUR, while the ongoing easing of lockdown measures are positive. The number of new COVID-19 cases continues to sit at sub-1,000 levels across France, Germany, Italy, and Spain and it will need to stay that way. At the time of writing, the EUR was up by 0.02% to $1.0952.

GBP/USD

It’s another relatively busy day ahead on the economic calendar. Key stats include April’s retail sales figures. The markets are not expecting the numbers to provide the Pound with any support, with the UK in deep lockdown throughout April. Brexit and COVID-19 news will remain the key drivers. The current week uptick will need to be accompanied by an easing in lockdown measures to support a breakout. A combination of negative Brexit updates and extended lockdown measures will likely continue to pin back the Pound. At the time of writing, the Pound was up by 0.07% to $1.2232.

USD/JPY

In April, inflationary pressures vanished, with Japan seeing an annual rate of core deflation of 0.2%. In March, the annual rate of inflation had stood at 0.6%, according to figures released by the Ministry of Internal Affairs and Communication. Economists had forecast an annual rate of core deflation of 0.1%. Month-on-month, consumer prices fell by 0.2% in April after having stalled in March. The annual rate of inflation softened from 0.4% to 0.1%. The Japanese Yen moved from ¥107.628 to ¥107.618 upon release of the figures. At the time of writing, the Japanese Yen was down by 0.06% to ¥107.68 against the U.S Dollar

Important data releases today

Time

CCY

Event

Forecast

Previous

11:30

GBP

Retail Sales (MoM) (Apr)

-16.0%

5.1%

17:00

INR

FX Reserves, USD

 

485.31B

17:00

EUR

ECB Publishes Account of Monetary Policy Meeting