- The Indian Rupee shows resilience during Monday’s trading in Asia.
- Geopolitical unease between India and Pakistan casts a shadow over the Indian Rupee’s performance.
- Increased foreign investment and a drop in crude oil costs could cushion the INR from further declines.
The Indian Rupee (INR) maintains its level on Monday. Heightened tensions with Pakistan could provoke risk aversion among investors, potentially weakening the Indian currency. The breach of the ceasefire agreement along the Line of Control (LoC) occurred shortly after the terror incident in Pahalgam, where 26 individuals, predominantly tourists, lost their lives in the Baisaran valley near Pahalgam, Jammu and Kashmir.
Conversely, Foreign Portfolio Investors (FPIs) have sustained their purchasing of Indian stocks for the seventh day running. This activity may strengthen the local currency relative to the US dollar in the short term. Additionally, the decrease in Crude oil prices may support the INR’s appreciation, given India’s position as the world’s third-largest crude oil consumer.
The US Dallas Federal Reserve Manufacturing Business Index for April is scheduled for release later today. The initial estimate of US economic output for the first three months of the year will be closely watched on Wednesday, preceding the US employment figures report, expected on Friday.
