USD/INR Price News: Rupee bulls look to 73.50 as India’s active covid cases print six-month low
- USD/INR prints three-day downtrend, holds lower ground near intraday low of late.
- India’s leaping vaccinations underpin hopes for a better festive season, favoring economic recovery hopes.
- US stimulus chatters, absence of Evergrande news supercede Fed tapering woes.
- US data, risk catalysts eyed amid a light calendar day.
USD/INR stays pressured around 73.73, down 0.10% on a day during early Monday. In doing so, the Indian rupee (INR) pair drops for the third consecutive day.
While a broad risk-on mood weighs on the US dollar’s safe-haven demand and drags the quote, COVID-19 related headlines from India also play their part to keep the pair sellers hopeful.
Among them are the latest government figures suggesting the lowest active virus cases since March 20. That said, the daily rise in the coronavirus cases eased to 26,041 versus 28,326 cases reported the previous day. However, the virus-led deaths increased from 260 to 276.
Also favoring the INR buyers is the Reuters news saying, “Indian shares have outperformed peers in emerging markets, helped by flush liquidity and as progress in the country's vaccination campaign has bolstered sentiment ahead of the festive season.”
On the other hand, optimism towards US stimulus, recently backed by House Speaker Nancy Pelosi, as well as headlines concerning the US-China relations, mainly due to the Canada-China prisoner swap, seems to play a major role help brighten the sentiment. Further, talks over easing virus-led activity restrictions from Japan and Australia add to the risk-on mood. Furthermore, the absence of Evergrande news and a little silence over the Fed tapering concerns add to the brighter risk appetite.
Amid these plays, the US 10-year Treasury yields pull back from a three-month high whereas the S&P 500 Futures rise 0.38% intraday by the press time.
While the sentiment-linked headlines may remain as the key driver for the USD/INR prices, the US Durable Goods Orders for August, expected +0.6% versus -0.1% prior, will offer intermediate clues.
Technical analysis
USD/INR remains trapped between a downward sloping resistance line from July 19 and a three-week-old support line, respectively around 73.90 and 73.65. Also acting as a downside filter is the 200-DMA level near 73.58.