American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Investing

USD/INR forecast: Here’s why the Indian rupee has crashed

by admin December 2, 2024
December 2, 2024
USD/INR forecast: Here’s why the Indian rupee has crashed

The USD/INR exchange rate rose to a record high of 84.60 as concerns about the Indian economy remained. It was trading at 85.54, up by almost 2% from its lowest point in January this year. It has risen in the past four consecutive days even as the US dollar index (DXY) retreated.

India GDP concerns

A key theme in the financial market has been that the Indian economy would benefit from the Chinese economic weakness. For one, India has a good relationship with the US, meaning that many companies would opt to move their plants there.

Data released last week showed that India’s economy was not doing well. According to the statistics agency, India’s economy grew at the slowest pace in almost two years.

The GDP grew by 5.4% in the third quarter, the worst reading since the fourth quarter of 2022. It was also much lower than the 7% that analysts and the Reserve Bank of India (RBI) were expecting. Now, analysts from top banks like Barclays and Goldman Sachs have slashed their Indian GDP forecasts for the year.

Therefore, analysts believe that the weak Indian GDP data will trigger a rate cut when the RBI meets this week. This was notable since the bank was not expected to cut this year as inflation has remained sticky.

The most recent economic data showed that the headline Consumer Price Index (CPI) rose from 5.49% in September to 6.21% in October. That report was higher than the median estimate of 5.81%. It was also the highest inflation reading since September 2023 and was mostly because of the rising food prices.

Therefore, a decision to cut interest rates this week means that the RBI risks high inflation figures in the country.

Read more: USD/INR forecast: pattern points to an Indian rupee comeback

Donald Trump’s tariff threat

The USD/INR pair has also surged as investors anticipate global trade volatility after Donald Trump moves to the White House. In a statement last week, he warned that he would apply universal tariffs to Chinese, Mexican, and Canadian imports, a move that will have a negative implication on the global economy.

He also threatened a 100% tariff on BRICS countries if they decide to ditch the US dollar for their trade. BRICS was originally made up of Brazil, Russia, India, China, and South Africa. It has now increased to more countries like Saudi Arabia, Ethiopia, Iran, and Egypt. 

Meanwhile, Indian stocks have also retreated in the past few weeks, with the NIFTY 50 index falling by 8.20% from its highest level this year.

USD/INR technical analysis

USD/INR chart by TradingView

The daily chart shows that the USD/INR exchange rate has been in a steady upside in the past few months. It has now jumped to a record high of 84.54, making the Indian rupee one of the worst-performing currencies in the market. 

The pair has remained above the 50-day and 25-day Exponential Moving Averages (EMA). Also, the MACD indicator has remained above the neutral level, while the Relative Strength Index (RSI) have pointed upwards. It is also higher than the Ichimoku cloud indicator. 

Therefore, the pair’s outlook is bullish, with the next point to watch being 86. This bullish outlook will remain as long as the pair stays above the two moving averages. 

However, as we have written before, it has formed a rising wedge on the weekly chart, pointing to a potential retreat in the near term. That drop, if it happens, would push the pair to the lower side of the ascending channel to about 84. 

The post USD/INR forecast: Here’s why the Indian rupee has crashed appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
Nifty 50 index risky pattern points to a strong reversal
next post
Gold price forecast: here are the key XAU levels to watch

Related Posts

International Graphite Receives R&D Refund and Firms Up...

March 12, 2024

Top crypto price predictions: VIRTUAL, Voxies, Fartcoin

May 1, 2025

Jordan Roy-Byrne: Gold Hyperbole is Real, Price Setup...

April 24, 2024

9 Arrests Made in Canada’s Largest Gold Heist

April 18, 2024

Osisko Metals Establishes a Technical Consultation Committee to...

February 28, 2024

Tilray Brands stock price has crashed: time to...

December 16, 2024

How to Invest in OpenAI’s ChatGPT (Updated 2024)

July 16, 2024

Daydream-2 Operations Update

August 9, 2024

Tilray stock price crashes below $1: buy the...

February 18, 2025

PayPal stock price analysis: the sky is the...

November 8, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • Interview: Strategic location gives Brazil Potash cost advantage in domestic fertiliser market, says CEO Matt Simpson

      June 1, 2025
    • Canada’s Q1 GDP expands by 2.2%, driven by exports spike ahead of potential US tariffs

      June 1, 2025
    • President Trump to host farewell for Elon Musk as DOGE leader steps away

      June 1, 2025
    • UK’s digital banks face divergent fortunes: Starling stumbles, Monzo and Revolut soars

      June 1, 2025
    • Trump wants Apple to shift iPhone production from India to the US: here’s what it means

      May 18, 2025

    Categories

    • Business (3,032)
    • Investing (2,462)
    • Latest News (1,994)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved