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Indian rupee weakens near 95.60 as US Treasury yields jump

The dollar bid and higher 10-year US yields, near 4.71% and close to an 18-month high, pressured the rupee in early trading.

Reported · Written up by our desk · Major Pairs

The Indian rupee edged lower against the US dollar on Thursday, with USD/INR hovering near 95.60 as investors favored the US currency amid rising US Treasury yields.

FXStreet said higher 10-year yields, around 4.71% and near an 18-month high, reduced the appeal of risk-sensitive currencies. The US Dollar Index (DXY) was up 0.12% to about 100.93 in early trade.

The move followed the Federal Reserve’s decision to keep interest rates unchanged at 3.50% to 3.75% for the fifth straight meeting on Wednesday. The Fed’s policy announcement came as oil prices had risen on escalating Middle East tensions, de-anchoring inflation expectations again.

FXStreet also noted that expectations of higher US rates this year boosted Treasury yields. It added that oil traded lower early on Thursday, with the MCX Crude Oil contract for August 19 down 1.1% to about Rs. 8,030.

Latest closeWTI crude $84.41 ▲6.5%|Dollar index 100.80 ▼0.6%

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