Overview
- Despite a decline in oil prices and lower U.S. Treasury yields, the Indian Rupee remains marginally unchanged due to persistent local U.S. dollar demand.
- The Reserve Bank of India's regular interventions have contributed to keeping the Rupee stable by defending the local currency.
- FX analysts predict the Rupee to continue trading close to 83.25 in the short term, but over 30% of strategists expect it to reach a new low by the end of January.
- Investors are waiting for remarks from U.S. Federal Reserve Chair Jerome Powell, which may provide indications for the future course of the central bank's policy and potentially impact the Rupee.
- Despite India's strong economic growth forecasted for the fiscal year, the Rupee has yet to reflect the favorable outlook due to its linkage with the U.S. dollar and the intervention of the Reserve Bank of India.