Rupee Opens Higher, Tracking Asian Peers

Rupee Opens Higher, Tracking Asian Peers

11 Jun 2019 09:12 AM
 
USD/INR – The Indian rupee opened higher against the dollar following a rebound in regional currencies led by the Chinese yuan. The rupee opened at 69.4475 to a dollar compared with its previous close of 69.65. India’s retail inflation and industrial output data, due Wednesday, along with expected mid-month dollar demand will be the other factors to watch for. The rupee was helped by the recovery on the yuan, which provided a boost to other Asian currencies. The Chinese currency was trading 0.2% higher against the dollar after closing at a six-month low in the previous session. The yuan’s rebound came amid comments by U.S. President Donald Trump that Beijing was giving itself a competitive advantage by weakening its currency, and that the country was offsetting the impact of the U.S. tariffs by letting the currency fall. Trump said that he was prepared to increase tariffs on imports from Beijing if Chinese President Xi Jinping failed to attend the upcoming G-20 meeting. EUR/USD – The euro was largely unchanged at $1.1317. The single currency dipped on Monday after two sources familiar with the European Central Bank's policy discussions said on the weekend that a rate cut was firmly in play if the bloc's economy stagnates again after expanding by 0.4% in the first quarter. EUR/USD has been unable to add to gains induced by Friday's disappointing jobs and hourly earnings reports and bulls now need a new catalyst to get the rally back on track. EUR/USD bulls could get a boost from U.S. May CPI and retail sales. Should the results continue the string of disappointing data short-term rates markets will price in a great chance of Fed cuts.

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