USDINR Analysis – December 15, 2023

USDINR fundamental analysis

USDINR fundamental analysis – On Friday, the Indian rupee improved to 83 per USD, moving away from the near-record low of 83.4 it maintained throughout December. This marks its strongest performance in three months, fueled by significant foreign exchange inflows into the Indian economy. Foreign banks have been buying rupees, driven by India’s strong growth, leading their custodian clients to boost investments in Indian assets. As a result, India’s domestic equity markets reached new highs, and government securities (G-Secs) climbed to three-month peaks.

The rupee also benefited from a weaker US dollar, following the Federal Reserve’s cautious economic outlook earlier this week. Earlier in the month, the rupee stayed close to its record lows but avoided falling beyond 83.4, thanks to the Reserve Bank of India’s (RBI) regular interventions in the forex markets to curb further decline. This trend has continued since the third quarter of 2022. Recent reports reveal that the RBI has sold over $23 billion in foreign exchange in the last four months. Source Bloomberg.

USDINR fundamental Analysis

USDINR Fundamental Analysis – Weekly Chart