USD/INR continues its winning streak for the third successive session on Thursday. The Indian Rupee (INR) remained under pressure as volatile oil prices and weak domestic equities weighed on sentiment, though intermittent US Dollar (USD) sales by state-run banks helped limit losses, traders told Reuters.
Oil prices rise due to shipping disruptions through the strategic Strait of Hormuz. Crude extended gains as the risk of a prolonged Iran conflict overshadowed a coordinated release of oil reserves by major economies. Markets also viewed the emergency supply measures as insufficient even after the International Energy Agency (IEA) agreed to its largest-ever release of 400 million barrels.
Meanwhile, the USD/INR pair strengthened as the US Dollar remained firm. Surging energy prices have heightened forward-looking inflation risks, reducing expectations that the Federal Reserve (Fed) will cut interest rates soon.
Meanwhile, recent inflation data suggested price pressures remain relatively contained, reinforcing expectations that the Fed may keep policy steady in the near term. Analysts also noted that the latest inflation figures do not yet fully capture the recent surge in oil prices driven by geopolitical tensions.
The February US Consumer Price Index (CPI) released on Wednesday showed inflation rising 0.3% month-over-month (MoM) and 2.4% year-over-year (YoY), largely in line with market expectations. Core CPI, which excludes food and energy, increased 0.2% MoM and 2.5% YoY. Traders will now focus on the upcoming US Personal Consumption Expenditures (PCE) data due Friday for further policy clues.
Technical Analysis: USD/INR eyes record high of 92.81 near ascending channel upper boundary
USD/INR trades around 92.70 on Thursday. The technical analysis of the daily chart indicates a persistent bullish bias as the pair rises within the ascending channel pattern.
The near-term bias is bullish as the USD/INR pair holds above both the rising 50- and nine-day Exponential Moving Averages (EMAs), keeping the recent breakout sequence intact after rebounding from the 91.00–91.25 area. Momentum remains positive with the 14-day Relative Strength Index (RSI) near 72 and pushing deeper into overbought territory, signaling firm upside pressure even as the rally becomes stretched.
The USD/INR pair targets the all-time high of 92.81, reached on March 9, followed by the ascending channel’s upper boundary at 92.90. On the downside, primary support lies at the nine-day EMA at 92.23. A break below this level would weaken the short-term momentum and expose the 50-day EMA at 91.17, followed by the channel’s lower boundary near 90.90.
USD/INR: Daily Chart
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