MUMBAI: The Indian rupee is likely to open marginally higher on Monday, shrugging off the decline in Asian peers amid higher odds of Donald Trump winning the November election.
Non-deliverable forwards indicate the rupee will open at 83.50-83.52 to the US dollar from 83.5350 in the previous session.
Asian currencies were down between 0.1% to 0.6%, with the offshore yuan slipping to 7.28 to the dollar.
Expectations of Trump reclaiming the White House have risen following an assassination attempt on Saturday.
With the assassination making it more likely that Trump will again be the US President, the focus in Asia will be on the yuan, a currency trader at a bank said, while adding that “he could not think of a particular reason” for the rupee’s rise in the non-deliverable forward market.
The dollar index was little changed and US equity futures inched up.
“For the moment, there is no sense of a big risk-off, which would suggest that the attack on Trump will not have much of an impact.”
The yuan was not helped by data that showed that China’s economy expanded at a slower pace than forecast in the June quarter, while the activity data for last month was mixed.
Meanwhile, data out on Friday showed that US June producer prices increased slightly more than expected on Friday.
However, that did not affect the Federal Reserve rate cut outlook.
The producer price print follows the softer-than-expected consumer inflation data.
Markets have now fully priced in a first Fed rate cut in September and 62 basis points cut this year versus 50 bps before the US consumer inflation data, MUFG Bank said in a note.
Comments
Comments are closed for this article.