Better-than-estimated numbers could restrict major downside for the dollar. This week, focus will be on services PMI and employment numbers from the US. The index was at 58.7 in December as compared to 61.1 in the previous month. Consequently, India’s trade deficit last month widened by 39.9% YoY to $21.99 billion, said Gaurang Somaiyaa, Forex & Bullion Analyst, Motilal Oswal Financial Services.ĭollar started the year on a positive note but was under pressure in yesterday’s second half of the session after data showed manufacturing PMI in the US fell in December. Imports also increased by 38.06% to $59.27 billion over $42.93 billion in December 2020. This is the highest-ever monthly achievement of exports so far. The country’s exports in December rose by a record 37% y-o-y to $37.29 billion. India is staring at high trade gap numbers in FY22 and FY23 with current account remaining in deficit due to increased imports. Rupee was weighed for the second successive session following trade balance number that showed the deficit widened in December. However, further fall was prevented on rise in risk appetite in the domestic markets and FII inflows, said ICICI Direct Currency Outlook report.īSE, NSE settlement holiday on 16 Aug, share trading to remain open check what happens to this week’s trades USDINR(Spot) to quote sideways with positive bias Rupee future maturing on January 27 depreciated by 0.33% on strong dollar, disappointing economic data from country and surge in crude oil prices. However, sharp upside was capped on disappointing economic data from the US. Further, Minneapolis Federal Reserve Bank President Kashkari said he expects the central bank to need to raise interest rates twice this year to address high inflation. The US dollar advanced 0.06% yesterday amid a surge in US treasury yields and decline in US stocks. The dollar index, which gauges US dollar’s strength against a basket of six currencies, was trading 0.02 % up at 96.23. dollar before settling at 74.57, down 29 paise over its previous close of 74.28. At the interbank foreign exchange market, the rupee opened at 74.49 and witnessed an intra-day high of 74.46 and a low of 74.61 against the U.S. The local unit settled at 74.57 (provisional) against the U.S. The Indian rupee on Tuesday weakened sharply against the US greenback as a surge in US Treasury yields supported the US dollar index, intensifying concern of overseas investment outflows from Indian markets.