USD/INR Price News: Indian Rupee eyes fresh five-week low under 82.00 as US Dollar struggles

• USD/INR pares intraday gains to revisit multi-day low marked the previous day.
• US Dollar fails to cheer hawkish Fed bets amid mixed US data.
• Market’s cautious optimism, upbeat energy prices allow Indian Rupee to grind at the highest levels since May 09.
• Mid-tier US data eyed ahead of next week’s Fed Chair Powell’s Testimony.

USD/INR remains on the back foot at the lowest levels in five weeks, fading bounce off intraday low to 81.95 early Friday morning in Europe. In doing so, the Indian Rupee (INR) pair cheers the US Dollar’s inability to justify the hawkish Fed halt, as well as the latest retreat in the Oil price, amid doubt about the July rate hike from the US central bank. Also, the risk-on mood in the Asia-Pacific markets weighs on the prices.

US Dollar Index (DXY) grinds near 102.20-30 while struggling to pare the biggest daily loss in three months. In doing so, the greenback’s gauge versus the six major currencies justifies the previous day’s mixed US data that challenge the Fed’s indirect commitment to lift the benchmark rates in July.

Talking about the data, US Retail Sales growth marked an increase of 0.3% for May versus -0.1% expected and 0.4% previous readings while the Core readings, mean Retail Sales ex Autos, match 0.1% market forecasts for the said month, compared to 0.4% prior.

Meanwhile, NY Fed Empire State Manufacturing Index jumps to 6.6 in June versus -15.1 expected and -31.8 prior whereas Philadelphia Fed Manufacturing Index drops to -13.7 for the said month from -10.4 prior and compared to -14 market forecasts. On the same line, US Industrial Production for May cools down to -0.2% against 0.1% estimated and 0.5% prior while Initial Jobless Claims reprints the upwardly revised figures of 262K for the week ended on June 09 versus 249K expected.

It should be noted that the WTI crude oil grinds near a one-week high, mildly offered near $70.70 by the press time, as energy traders seek more clues to convince buyers amid mixed concerns about China's recovery. “UBS cuts China growth forecast to 5.2% after disappointing data,” said Bloomberg.

Looking ahead, the preliminary readings of the Michigan Consumer Sentiment Index (CSI) and five-year inflation expectations for June will be important for fresh impulse ahead of next week’s Fed Chair Jerome Powell’s testimony.

Technical analysis

A seven-month-old ascending support line, around 81.90 by the press time, restricts immediate USD/INR downside ahead of the double bottoms marked near 81.50. The pair’s recovery moves can take clues from the RSI but remain elusive unless crossing the month-start bottom of around 82.30.