USD/INR cheers less phase-one negatives of Hong Kong Act, eyes on India GDP
- USD/INR extends the previous recovery from multi-day high.
- The absence of Chinese warnings on phase-one keeps Asian traders hopeful.
- India’s Q2 GDP, full market reaction to the US-China tussle will be in the spotlight.
USD/INR takes the bids to 71.72 during the pre-European session trading on Friday. The quote seems to benefit from the lack of a negative response to the United States (US) President’s passage of the Hong Kong Human Rights Democracy Act.
China’s initial reaction to US President Donald Trump’s passage of the act was very harsh and signaled to ban the writers of the bill. Though, diplomats from both the countries, namely the US and China, stay confident over signing a partial, phase-one, trade deal in the coming weeks, as per the Wall Street Journal (WSJ).
It’s worth mentioning that the absence of the US traders due to the Thanksgiving Day holiday and a mild risk-off also favors the USD/INR pair ahead of the key growth numbers from India.
That said, Indian equity markets are on the negative side with BSE SENSEX flashing -0.50% mark while the US 10-year Treasury yields taking rounds to 1.77% by the press time.
India’s September quarter Gross Domestic Product (GDP) data, forecast 4.7% versus 5.0% prior, is up for publishing at 12:00 GMT. Reuters’ poll cites increased possibilities of witnessing multi-quarter low growth figures while saying, “If the latest figure for expansion of gross domestic product is 4.7% or less, the quarter will have registered the slowest expansion in 26 quarters, since 4.3% in January-March 2013.”
Other than the key data from India, investors will keep eyes on how the market will respond to the US-China jitters when the US traders return to the desk, even for a half session, on Friday.
Technical Analysis
A two-week-old falling trend line around 71.77 holds the key to pair’s run-up towards 72.00 round-figure. On the downside, recent lows near 71.20, comprising 61.8% Fibonacci retracement of the current month upside, challenges short-term sellers.