29 May 2023

Tentative debt ceiling agreement to strengthen USD

As per latest development, U.S. President Joe Biden and top congressional Republican Kevin McCarthy reached a tentative deal to suspend the federal government's $31.4 trillion debt ceiling. Consequently, it will make USD appreciate against other currencies in the coming days. Indian rupee has appreciated against USD driven by rise in USD inflow.

author dp
Team INRBonds
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  • The USD continued to move higher against its major peers driven by news of debt ceiling and as investors weigh the Federal Reserve's next move.
  • The personal consumption expenditure price index in the United States rose by 4.4% year-on-year in April 2023 from 4.2% rise in the previous month.
  • As per second estimate, the US economy grew by an annualized 1.3% in Q1 2023.
  • The US initial jobless claim rose to 229,000 in the week ending May 20th, slightly up from an over two-month low of 225,000 the week before
  • Domestic currency appreciated by 0.13% against USD on a weekly basis supported by dollar inflows into the equity market.

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