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Rupee weakens ahead of US jobs data as oil rebounds

USD/INR is near 95.27, with oil higher by 1.13% on the MCX contract into Aug. 19, a mix traders watch for USD strength and INR sensitivity.

Reported · Written up by our desk · Major Pairs

The Indian rupee is edging lower against the US dollar as traders look ahead to the US Nonfarm Payrolls report for July, due at 06:00 PM IST, according to FXStreet. Ahead of the release, the USD/INR pair has risen to around 95.27.

FXStreet notes that expectations for the labor market are shaped by recent ADP Employment Change data for July, which has left investors cautious. NFP estimates call for the US economy to have added 80K jobs, versus 57K in June, with the unemployment rate expected to hold at 4.2%, and average hourly earnings seen at 0.3% monthly and 3.5% year over year.

The report also highlights that wage growth could influence the next move in the US dollar, particularly given policymakers concerns about inflation staying above the 2% target. FXStreet adds that CME FedWatch shows a 54.5% chance of a September rate increase.

Oil prices have rebounded after a sharp two week drop, and FXStreet links the move to rising Middle East supply risks tied to tensions involving Iran-aligned Houthis and Saudi Arabia. The MCX Crude Oil contract expiring Aug. 19 is trading about 1.13% higher near Rs. 7,460, while USD/INR remains capped below the 20 day EMA around 95.57, with the pair still showing mild near term downside risk.

Latest closeWTI crude $78.07 ▲3.8%

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