USD to INR Forecast: The Path of Least Resistance for USD/INR

Summary:
• What is the forecast for the USD to INR pair? We explain what to expect now that the USD/INR has rallied recently

The USD to INR price is hovering near its all-time high as the Indian rupee sell-off continues. The USD/INR is trading at 77.28, meaning it has risen by more than 4% this year. It has risen by over 20% in the past five years, meaning that Indian’s savings have been losing their value. Other emerging market currencies like the Turkish lira and the Brazilian real have also been plummeting.

The USD/INR pair continued its bullish trend after the latest inflation numbers from the United States. The numbers revealed that the country’s prices remained substantially high as the cost of gasoline jumped to a record high. Precisely, the headline inflation inched down slightly to 8.3% from the previous 8.5%. This drop was in line with what most analysts were expecting. However, additional data showed that core CPI moved lower to 6.0%. 

The next key important data to watch will be the latest US producer price index data scheduled for Thursday. Economists expect these numbers to reveal that the headline PPI declined from 11.2% to 10.7%, while the core PPI fell from 9.2% to 8.9%. These numbers will provide a gauge of the prices that American producers are paying. 

Meanwhile, the USD to INR will react mildly to important data from India. The statistics agency will publish the latest consumer inflation, industrial production, and federal fiscal deficit. Economists believe that the data will show that inflation rose from 6.95% to 7.50% in April. If this happens, it will increase the need for another rate hike by the RBI. 

USD to INR prediction

The USD/INR pair has been in a strong bullish trend lately. Along the way, it has managed to cross the important resistance levels at 76 and 77. Most recently, it moved above the key resistance level at 77.15. The upward move has been supported by moving averages and the ascending trendline. At the same time, important oscillators have been moving upwards as well. 

Therefore, after managing to cross 77.17, there is a likelihood that the bullish trend will continue as investors focus on the key resistance at 78. As a result, the stop-loss for this trade will be at 77.0.