USD / INR Analysis

USD / INR Analysis

USD / INR is trading near 74.77 after the decrease this week. TD Securities economists expect the RBI FX intervention to decrease and INR to trade with a short-term tight trend. “RBI will continue to mitigate policies in this cycle, possibly with at least 50bp more interruptions. In addition, we think that inflation will not be a restriction for debt earning in the current environment. " “RBI should take the debt monetary issue seriously. The risk is that rating agencies can view debt monetary as a trigger to push India's ratings down to trivial levels, which can damage Indian markets. However, as long as such measures are considered exceptional, not the new norm, inflation and INR will be brought under control. " “RBI will be less intrusive prospectively, which will enable INR to benefit from strengthening FDI inflows. INR is expected to trade more tightly in the short term. INR sensitivity to the USD movement has increased, indicating that it will benefit from any pressure on the USD. "