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AED • EUR • GBP • USD IBANs   |   CROSS BORDER FX   |   LOCAL CURRENCIES   |   GLOBAL COVERAGE
INR

Rupee Pauses Losses on Softer Dollar

The Indian rupee hovered around 95.2 per dollar, pausing recent losses as the greenback softened on softer-than-expected labor data. June payroll growth slowed sharply while gains for the previous two months were revised lower, prompting traders to reduce the probability of a September Federal Reserve rate hike to around 53%, down from 75% before the report. The weaker dollar lifted most Asian currencies, providing support for the rupee. Despite the improved sentiment, investors continue to monitor merchant and portfolio flows after the rupee fell to a three-week low in the previous session, pressured by arbitrage-related demand and importer dollar purchases. Earlier this week, the currency was supported by interventions from the RBI in both the onshore spot and offshore non-deliverable forwards markets. However, those efforts were largely offset by persistent dollar demand from foreign banks and oil companies, as well as continued foreign investor outflows from Indian equities.

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