USD/INR Price News: Rupee bears flirt with 80.00 as FICCI cuts India’s FY23 GDP forecast

• USD/INR grinds higher around intraday top, stays inside 79.70-80.15 weekly trading range.
• FICCI cuts India’s FY 2023 GDP growth forecasts, Indian equities brace for the best week since mid-March.
• US PMIs, Fed’s moves will be important for fresh impulse.

USD/INR dribbles around the daily top surrounding 79.90 as the US dollar consolidates the previous day’s losses ahead of the key PMI data for July, as well as next the next week’s Federal Open Market Committee (FOMC). It’s worth noting that the recovery in oil prices and fears of India’s economic slowdown also propel the Indian rupee (INR) pair heading into Friday’s European session.

That said, the WTI crude oil prices pare the biggest daily slump in eight days around $96.50 by the press time.

On the other hand, India’s industry body, the Federation of Indian Chambers of Commerce and Industry (FICCI) downgrades the nation’s GDP forecasts in its quarterly survey. “The Indian economy is expected to expand 7% in fiscal 2022/23, slower than a previous estimate of 7.4% and the central bank's 7.2% projection, according to a survey by India's leading industry body,” reported by Reuters.

Elsewhere, the US Dollar Index (DXY) picks up bids to refresh its intraday high around 106.95, up 0.35% on a day, as sour sentiment joins sluggish yields to help the greenback pare latest losses. Even so, the DXY braces for the first weekly loss in four while extending the July 14 reversal from a nearly two-decade high. The greenback’s previous weakness could be linked to the US Treasury yields as the benchmark 10-year bond coupons marked the biggest daily slump since mid-June on Thursday, as well as eyes the second consecutive weekly loss.

Amid these plays, Wall Street benchmarks closed firmer and the US Treasury 10-year Treasury yields marked the biggest daily slump in five weeks, down one basis point (bps) to 2.90% at the latest. That said, S&P 500 Futures drops 0.45% by the press time.

Moving on, preliminary figures of the US S&P Global Manufacturing and Services PMI for July are crucial for USD/INR traders, especially after the ECB and before next week’s Fed meeting. The reason could also be linked to the recession fears and chatters surrounding the central bank’s aggression. That said, the US S&P Global Manufacturing PMI is expected to decline to 52.0 from 52.7 whereas its Services counterpart could ease to 52.6 from 52.7. With this, the Composite PMI may drop to 51.7 from 52.3 prior. Considering the downbeat forecasts for the US data, the US dollar may witness further headwinds and the same could tame the USD/INR prices if the actual figures match the market consensus.

Technical analysis

A one-week-old trading range between 79.70 and 80.15 restricts immediate USD/INR moves. However, the previous resistance line from early March, at 78.95 by the press time, appears a tough nut to crack for the pair sellers.