USD rebounds after weak Q3 GDP
The 10-year UST yield fell to 1.56% level in a volatile session on Friday as the bond market remained unsettled ahead of next week�s Fed meeting. USD traded higher as the Fed preferred inflation measure (PCE) showed prices continuing to rise faster than its 2% target.
USD was under pressure on Thursday as the data revealed that economic growth in the US slowed in the July � September period to just 2%. This was down from 6.7% in the previous quarter.
Euro fell on Friday after posting a sharp gain on a prior day session following Thursday�s ECB meeting, which resulted in the central bank leaving interest rates and asset purchases unchanged, as expected. However, the ECB President suggested that the inflation will be higher for longer, prompting market participants to bet on the central bank being quicker in tightening its accommodative monetary policy.
INR rises as Shaktikanta Das is re-elected to govern RBI
INR ended the week marginally higher as RBI will be governed by Shaktikanta Das for three more years after he was re-elected on Friday. The move has been cheered by the financial markets. Under Das, the RBI has cut interest rates to record lows.
Oil prices are offering some support to the INR as prices fell lower after industry data revealed that crude stockpiles unexpectedly rose last week. Weaker oil prices bring some relief to Indian which imports over 80% of its crude oil.
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