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Indian rupee holds weekly gains as USD slips to over two-week low

USD/INR fell to near 95.30, while Fed Chair Kevin Warsh avoided explicit interest rate forward guidance and reiterated the need for action against hot inflation.

Reported · Written up by our desk · EM Currencies

The Indian rupee extended its week-long rally against the US dollar on Friday, pushing USD/INR down to a fresh level not seen in more than two weeks near 95.30, according to FXStreet.

FXStreet attributed the dollar slide to growing doubts about whether the Federal Reserve is firmly committed to bringing US inflation lower, and noted that the US Dollar Index remained around 100.0 even as it dropped almost 0.9% on Thursday to about 99.86.

FXStreet also pointed to comments from Fed Chair Kevin Warsh, who maintained inflation-focused rhetoric and said the central bank would make necessary monetary policy adjustments to combat high inflation, while refusing to provide rate forward guidance.

Separately, higher oil prices driven by fears of prolonged energy supply constraints tied to ongoing US-Iran tensions and wider Middle East strain were flagged as a factor that could limit upside for the rupee, with TD Securities saying supply disruptions are tightening the global energy balance and supporting potential additional gains in crude.

Latest closeWTI crude $86.80 ▲3.8%|Dollar index 99.80 ▼0.2%

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