{"id":15384,"date":"2024-10-16T08:35:00","date_gmt":"2024-10-16T08:35:00","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=15384"},"modified":"2024-10-16T08:35:00","modified_gmt":"2024-10-16T08:35:00","slug":"rupee-gains-as-risk-appetite-remains-weak","status":"publish","type":"post","link":"https:\/\/www.global-vtrader.com\/en\/analysis\/rupee-gains-as-risk-appetite-remains-weak\/","title":{"rendered":"Rupee Gains as Risk Appetite Remains Weak"},"content":{"rendered":"\n<h4 class=\"wp-block-heading\">Key points:<\/h4>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The dollar index edges lower to 103.18, easing pressure on Asian currencies.<\/li>\n\n\n\n<li>Foreign investors sold a net $423.2 million of Indian equities on October 14, reflecting a weaker risk appetite.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p class=\"wp-block-paragraph\">The Indian rupee is set to open steady against the U.S. dollar, holding near the 84 mark as a slight retreat in the dollar provides some breathing room. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">On Tuesday, the rupee saw a mild recovery, aided by dollar sell orders from public sector banks, possibly linked to central bank intervention. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Market participants remain cautious, as traders report that the currency\u2019s drop beyond the psychological 84 level has not sparked volatility as expected.<br><br><strong>See also: <a href=\"https:\/\/www.vtmarkets.com\/analysis\/indian-rupee-hits-record-low-amid-dollar-demand\/\">Indian Rupee Hits Record Low Amid Dollar Demand<\/a><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Currency desks at banks suggest that the absence of a sharp follow-through below 84 reflects a period of low volatility. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Traders are adjusting their strategies, taking on larger positions to extract smaller profits within a narrow range.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/wp-content\/uploads\/2024\/10\/image-28-1024x469.jpeg\" alt=\"\" class=\"wp-image-15385\" style=\"width:1450px;height:auto\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center wp-block-paragraph\"><em>See: The USD\/INR chart shows consolidation around 84.17 with low volatility and neutral momentum on the <a href=\"https:\/\/vtmarketsapp.onelink.me\/CD7D\/240525WA\">VT Markets app<\/a>.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\"><strong>Dollar Retreats as U.S. Yields Fall and Economic Data Soften<\/strong>s<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The dollar index (DXY) has eased to 103.18, pulling back from its recent peak, which had marked a two-month high. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This retreat came on the back of weaker U.S. Treasury yields and softer economic data. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In particular, the New York Fed\u2019s manufacturing activity index underwhelmed expectations, prompting market participants to shift towards safer assets such as U.S. Treasuries. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Meanwhile, U.S. equities declined, with Asian stock markets following suit, further curbing risk appetite.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\"><strong>Market Anticipates 25-Basis-Point Rate Cut from Fed<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Market participants are now leaning towards a 25-basis-point rate cut from the U.S. Federal Reserve at its next meeting, a softer stance compared to the 50-basis-point hike seen in September.\u00a0<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Fed officials, including Raphael Bostic, have signalled a cautious approach, indicating only one more cut of 25 basis points this year. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The FedWatch tool also reflects this sentiment, with traders anticipating two 25-basis-point cuts before the end of 2024.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Fed&#39;s Bostic Wants Just One More Rate Cut This Year <a href=\"https:\/\/t.co\/5vA6EI2K4q\">https:\/\/t.co\/5vA6EI2K4q<\/a><\/p>&mdash; Pedro da Costa (@pdacosta) <a href=\"https:\/\/twitter.com\/pdacosta\/status\/1846347188819185888?ref_src=twsrc%5Etfw\">October 16, 2024<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">The latest NSDL data shows that foreign investors offloaded $423.2 million in Indian equities and $27.9 million in bonds on October 14. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The reduction in inflows indicates that global market participants are scaling back exposure to emerging markets, including India, amidst heightened caution. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This outflow adds pressure on the rupee and local markets, even as the dollar softens. The rupee\u2019s outlook remains tied to dollar movements and Fed policy cues. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Traders expect subdued volatility ahead but remain on guard for any shifts in global risk sentiment or unexpected central bank actions. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As oil prices stabilise, the rupee may find support, but foreign portfolio flows remain a concern for the broader market.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Start trading now \u2014 click <\/strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/?utm_campaign=account_c&amp;utm_source=dma&amp;utm_medium=website\"><strong>here<\/strong><\/a><strong> to create your live VT Markets account.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Indian rupee stays firm below 84 as the dollar weakens and risk-off sentiment rises. Traders watch for U.S. Fed signals on rate cuts. &#8211; vtmarkets.com <\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[27],"tags":[12,43],"class_list":["post-15384","post","type-post","status-publish","format-standard","hentry","category-analysis","tag-forex","tag-rupee"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/15384","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/comments?post=15384"}],"version-history":[{"count":0,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/15384\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/media?parent=15384"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/categories?post=15384"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/tags?post=15384"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}