USD/INR Price News: Rupee wobbles near 74.50 as India’s credit rating upgrade battles firmer USD
- USD/INR remains firmer around 11-week top, grinds higher of late.
- Moody’s upgrade India’s credit rating, active covid cases in India drop to March 17 lows.
- US Treasury yields underpin greenback strength amid US debt ceiling anxiety, Fed tapering concerns.
- US data, politics can entertain traders ahead of NFP, RBI.
USD/INR bulls take a breather around multi-day top close to 74.60 ahead of Wednesday’s European session. In doing so, the Indian rupee (INR) pair justifies the US dollar strength by the press time.
Although S&P kept India’s credit rating stable the previous day, Moody’s raised the Asian nation’s credit outlook to Stable from Negative citing the receding financial sector risks.
Also positive for the INR is the latest trend of easing COVID-19 infections. As per the latest government figures, covid cases rose to 18,833 from 18,346 reported yesterday while the virus-led deaths rose to 278 from 263. However, the active coronavirus cases dropped to the lowest since March 17.
However, the US Treasury yields keep the US dollar high amid cautious sentiment. That being said, the US Dollar Index (DXY), a gauge of the greenback versus major currencies, extends the previous day’s rebound near 94.08, up 0.11% on a day by the press time. Further, the US 10-year Treasury yields gain 3.8 basis points (bps) near 1.57% to refresh the four-month high.
The reason for the market’s indecision could be linked to the doubts over the US stimulus and the debt limit extension, not to forget the Sino-American tension. US President Biden stays determine the tackle the key budget and relief package issues before the October 18 deadline despite the GOP rejection. Also to note is President Biden’s phone call with his Chinese counterpart Xi Jinping and readiness to respect the Taiwan agreement.
Amid these plays, stocks in India print mild gains whereas S&P 500 Futures remain pressured at the latest.
Moving on, the USD/INR traders the risk catalysts and the US ADP Employment Change for September for fresh impulse ahead of Friday’s US Nonfarm Payrolls (NFP), not to forget China’s return after a long break. However, the Reserve Bank of India (RBI) meeting will also be the key amid chatters over getting qualitative measures for liquidity injection.
Read: US ADP Employment Change September Preview: Yes, its all about the Fed
Technical analysis
USD/INR bulls seek confirmation from the 74.65 level to aim for the 75.00 threshold, adjacent to the yearly peak. On the contrary, the bears may not risk taking the entries until the quote drops below 74.50, including multiple tops marked since August.