Rupee Outlook - July 9, 2021 - Anindya Banerjee, DVP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities

Much ado about nothing. That is exactly how USDINR faired over this week. There were some key events like hawkish minutes from US Fed causing carry trade to unwind and trigger sell-off in equity markets and also no-deal in OPEC meeting causing volatility in oil prices. However, all of that failed to increase volatility in USDINR. July futures closed 0.17% lower at 74.79 levels.

Next week can be eventful with FPI inflows expected to pick up in the marquee IPO from Zomato. At the same time, CPI inflation and industrial production data will be due from India. A higher inflation print and softer industrial activity, which are expected, can be positive for USDINR. However, the biggest driver of USDINR will still be the trend in the US Dollar Index and in the equity markets.

Source : Equity Bulls

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