India’s rupee remains range-bound near 95.20 despite easing inflation risks from lower crude prices and weak monsoon concerns.
The Indian rupee closed at 95.20 against the US dollar on Friday, down 0.2% but up 0.9% for the week, holding within a 94-96 range. Lower oil prices are expected to support domestic demand and ease inflationary pressures, though weak monsoon conditions pose growth risks.
India’s services PMI dipped to 57.4 in June from 59.8 in May, marking a 17-month low, while the composite PMI fell to 57.1. Analysts attribute the slowdown to higher fuel prices, weaker household purchasing power, and below-average monsoon rainfall. Export demand, however, reached a three-month high.
The Reserve Bank of India may remain cautious amid growth uncertainties, potentially delaying policy easing despite easing inflation pressures from lower crude prices.