The Indian Rupee Strengthened Tracking Upbeat Risk Appetite

The Indian Rupee Strengthened Tracking Upbeat Risk Appetite

15 Jul 2020 10:08 AM
 

Market Analysis

USD/INR

India rupee opened higher at 75.34 against its last close of 75.415. The Indian rupee strengthened against the U.S. currency tracking upbeat risk appetite and broad dollar weakness following a positive update on the development of a coronavirus vaccine. Equity gauges of Japan, South Korea, Australia, and Hong Kong were up at least a percent each, and U.S. futures indicated that Wall Street will add to yesterday’s advance. The SGX Nifty signaled that Indian equities will rebound from their worst session in a month. Optimism on a vaccine to combat the coronavirus boosted Asian currencies and equities.

EUR/USD

It’s a relatively busy day ahead on the economic calendar. Key stats are limited to Italy’s finalized inflation figures for June. The stats are not expected to have any impact on the Euro. Market sentiment towards the economic outlook and COVID-19 will remain the key drivers on the day. The news of progress towards a COVID-19 vaccine was positive for the EUR. At the time of writing, the EUR was up by 0.11% to $1.1412.

GBP/USD

It’s a relatively quiet day ahead on the economic calendar. Key stats include June inflation figures. We’re not expecting the markets to pay too much attention to the numbers, however. That leaves the Pound in the hands of Brexit and market risk appetite. At the time of writing, the Pound was up by 0.24% to $1.2583.

USD/JPY

USD/JPY is barely moving in response to the Bank of Japan's latest decision to keep key monetary policy tools unchanged. The central bank retained the 10-year government bond yield target at 0.00% and kept the policy balance rate unchanged at -0.10%, as widely expected. As such, there is little reason for traders to buy or sell the Japanese yen aggressively. However, the BOJ said that the Japanese economy is in an extremely severe situation and could contract by 4.7% in the financial year 2020. The anti-risk yen could also face selling pressure due to the uptick in the stock markets. As of writing, USD/JPY is trading largely unchanged on the day near 107.25, having witnessed a 5-pip rise to 107.31 immediately following the BOJ rate decision.

Important data releases today                   

Time

CCY

Event

Forecast

Previous

11:30

GBP

CPI (YoY) (Jun)

0.4%

0.5%

19:30

INR

Trade Balance

-4.50B

-3.15B

20:00

USD

Crude Oil Inventories

-2.098M

5.654M