Rupee Opens Higher Ahead Of US Jobs Data

Rupee Opens Higher Ahead Of US Jobs Data

07 Jun 2019 09:10 AM
 
USD/INR – The Indian rupee opened higher against the dollar ahead of the U.S. non-farm payroll data, which will be closely watched amid Federal Reserve rate cut bets. The rupee opened at 69.19 to a dollar compared with its previous close of 69.2650. The data will be scrutinized closely to assess the likelihood of the Fed cutting rates at the upcoming meeting. Probability of the Fed lowering the interest rates this year has increased in recent weeks amid mounting U.S.-China trade tensions. A top Fed policymaker said that an interest rate cut may be needed in light of the risks to growth posed by the trade uncertainties. Fed Chair Jerome Powell has suggested that rates could be cut if the ongoing trade war affected the economic outlook. The odds of a quarter percentage rate cut at the June meeting are currently at 20%, up from 6% a month ago. For the July meeting, at least a 25 basis-points rate cut is assigned an over 60% probability, according to the CME FedWatch Tool. EUR/USD – The euro jumped half a percent against the dollar on Thursday after the European Central Bank refrained from hinting at an interest rate cut and instead pushed back the timing of its first rate hike since the 2008 financial crisis. The euro rose because investors had expected an even more dovish signal from the ECB and an acknowledgement of weak economic growth in the bloc. The ECB said it would lend to banks at a rate just 10 basis points above its minus 0.4% deposit rate in a new targeted longer-term refinancing operation, or TLTRO. The euro has strengthened recently on the back of dollar weakness caused by rising bets on a U.S. interest rate cut. The single currency was 0.47% higher at $1.1270 after brushing a 1-1/2-month high of $1.1310 earlier this week.

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