Forex Analysis & Reviews: 16.11.2022 - Indian rupee: declining...

16.11.2022 11:31 PM

Indian rupee: declining following GDP

The Indian rupee continues to weaken as demand from exporting companies pushes the dollar higher. The weakness in Asian equities and currencies has now spilled over into domestic markets.

Indian rupee: declining following GDP

Data released by India's statistics authority showed India's merchandise trade deficit widened to $26.91 billion in October. The drawdown was more than $1 billion in net revenue, compared to $25.71 billion in September.

India's merchandise exports fell by almost $6 billion to $29.78 billion from $35.45 billion in the previous month, while imports fell to $56.69 billion from $61.16 billion in the same period.

The reasons are not only global economic problems, but above all crop failure due to heavy rainfall during the harvest period. The crop failure reached domestic markets, affecting the cost of basic food products - flour, legumes. After grain, meat, eggs and milk also become more expensive. Basic foodstuffs form the basis of household expenditures in the country.

Amid the news, the rupee fell 0.25% to 81.2975 per dollar. The currency lost almost a percentage of its high of 80.51 on Monday, partly due to volatility in the Asian market.

The huge demand for cash dollars in both the spot and forward markets is spurring the fall. Of course, foreign banks also buy on behalf of their importing clients.

At the same time, the decline in USD/INR forward premiums made importers attractive to hedgers, which led to an increase in dollar outflows. The cost of hedging the 6-month dollar is down 25 basis points this week.

As a result, for the day the dollar index fell by 0.3% after the initial increase. There is hope that the currency will bounce back postmarket as US President Joe Biden reassured the international community by saying that the missile that caused the explosion in NATO member Poland may not have been fired from Russia.

However, the excitement peaked in the early Asian session. As a result, Asian equities and currencies remained volatile, with the Chinese yuan and equities down 0.5% each.

Concerns about a rise in COVID-19 cases in the major cities of Guangzhou, Beijing and Zhengzhou also played a role.

The recent turmoil in the currency markets has also left investors wondering which way the Indian currency will move. With the expected recession in developed markets hitting global trade, some believe the dollar will bounce back and put pressure on Asian currencies. This is a realistic option, at least during the early recession. The dollar rally is far from over, and it makes sense to keep the rupee forecast at 83.50 and 84-85 by the end of December and the end of March, respectively. At least it is not noticeable that the Federal Reserve will stop in the short term, so it is only natural to expect a resumption of the dollar rally.

你今天已经点赞上这篇文章了

*这里的市场分析是为了增加您对市场的了解，而不是给出交易的指示。

If you have any content questions, please contact editorial-board@instaforex.com

News

Egor Danilov,
Analytical expert of InstaForex
© 2007-2025

该作者的更多文章

EURUSD

Euro vs US Dollar

选择时间框架

分钟

小时

天

周

开始交易

通过InstaForex赚取加密货币汇率变动的收益。

下载MetaTrader 4并开启您的第一笔交易。

Indian rupee: declining following GDP

推荐文章

特朗普再次震撼華爾街：市場指數瞬間反應

6月2日美國市場新聞摘要

特朗普再度影響華爾街，指數迅速反應

當投資者在各行業間重新平衡時，波音上升，Best Buy下跌

5月30日美國市場新聞摘要

波音上漲，Best Buy下跌：為什麼投資者選擇不同資產下注

5月29日美國市場新聞摘要

股市風暴：Nvidia 股價飆升，道瓊指數下跌，法院推翻特朗普關稅

從Nvidia到小米：當今股票市場增長與衰退的推動因素

不冒著經濟衰退風險的人無法減少國家債務？交易者日曆：5月29日至31日

Top analytics

Indian rupee: declining following GDP

推荐文章

特朗普再次震撼華爾街：市場指數瞬間反應

6月2日美國市場新聞摘要

特朗普再度影響華爾街，指數迅速反應

當投資者在各行業間重新平衡時，波音上升，Best Buy下跌

5月30日美國市場新聞摘要

波音上漲，Best Buy下跌：為什麼投資者選擇不同資產下注

5月29日美國市場新聞摘要

股市風暴：Nvidia 股價飆升，道瓊指數下跌，法院推翻特朗普關稅

從Nvidia到小米：當今股票市場增長與衰退的推動因素

不冒著經濟衰退風險的人無法減少國家債務？交易者日曆：5月29日至31日

Top analytics

Dear visitor,