Halister News

(Bloomberg) -- USD/INR may continue to trade between 200-DMA and 100-DMA in near term if India’s March CPI data match economists’ estimate, Bloomberg strategist David Finnerty writes.

• CPI will rise 5.00% y/y last month after 5.18% gain in Feb. according to median est. of economists in Bloomberg survey; ests. range from 4.80% to 5.24%; data due at 5:30pm local time tomorrow; Feb. industrial production also due tomorrow; est. 1.0% y/y vs 1.5% decline in Jan.
• RBI could stay on hold at least in short term, while it watches effects of its rate cut earlier this month as well as whether monsoon season leads to an uptick in food prices; RBI could also monitor if 7th Pay Commission award spurs increased domestic spending that may further mitigate CPI’s downtrend
• Rupee strength since beginning of March has been aided by Fed’s dovish stance, and with few expectations of U.S. Fed rate hike this month, INR is unlikely to weaken
• NOTE: David Finnerty is an FX strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.