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Fed comments, DXY, and the curious case of $INR
Powell's recent 'higher for longer' rhetoric has the dollar index looking robust, which usually spells trouble for emerging market currencies. Yet, we're seeing $INR at 12.84, down just a percent on the day, holding relatively steady given the broader climate. Makes me wonder if the market's already priced in most of the hawkishness or if there's some underlying strength in India's domestic economy quietly defying the strong dollar narrative. Definitely keeping an eye on that range; could be an interesting counter-trend play if it holds this floor.
1 comments · 18 points
It's an interesting point about INR. Could be a reflection of that domestic demand, or perhaps the RBI has been more active in FX intervention than we typically see. Hard to say without clearer data on their operations.