USD/INR: Consolidation near record highs – Commerzbank
Bitcoin Ethereum News Commerzbanks Charlie Lay and Moses Lim note that the conflict in the Middle East and higher Oil prices have weighed heavily on the Indian Rupee (INR), while the Reserve Bank of India (RBI) focuses on stability. RBI keeps the policy rate at 5.25% and intervenes in FX markets, with USD/INR expected to trade in a supported 92–95 range near term. RBI support keeps Rupee constrained “INR has borne the brunt of the oil shock. It is down 3.4% vs USD since the start of the Iran war and down nearly 5% year-to-date. RBIs near-term focus is to smooth out excessive FX volatility.” “RBI is expected to leave the policy rate unchanged at 5.25% in the near term, opting for flexibility amid elevated global uncertainties. USD-INR could continue to remain well-supported in the near term, between the 92-95 range.” “USD/INR climbed to a record high of just above 95.20 in late March. It traded between the 92-95 range since RBIs measures. FX reserves are still at a healthy level of just over USD700bn as of 17 April, around 11 months of import cover. We look for consolidation in USD/INR in the near term with RBI intervention to contain the upside.” “RBI Governor Sanjay Malhotra