The Indian Rupee (INR) has shown weakness recently, pressured by month-end demand for the U.S. dollar (USD) and developments in U.S. trade policy. The recent U.S. court ruling blocking President Donald Trump’s tariffs has lent support to the USD, indirectly weighing on the INR. Additionally, rising crude oil prices are adding selling pressure on the Indian Rupee, as India ranks as the world’s third-largest oil consumer.
USD Supported by Tariff News but Faces Potential Headwinds
While the blocking of tariffs has strengthened the USD, concerns remain over U.S. trade and fiscal policies, which may undermine investor confidence in U.S. assets. This uncertainty could spark a “sell U.S. assets” narrative, potentially pushing the dollar lower in the short term.
Key U.S. Economic Data in Focus
Market participants are awaiting the second estimate of the U.S. first-quarter gross domestic product (GDP), due later on Thursday. Additional important releases include weekly initial jobless claims and pending home sales data. Furthermore, Federal Reserve officials — including Thomas Barkin, Austan Goolsbee, Adrienne Kugler, and Mary Daly — are scheduled to speak, which could impact market sentiment.
Technical Analysis: USD/INR Bears Maintain Control
On the daily chart, USD/INR continues to display a bearish trend, with sellers defending the 100-day exponential moving average (EMA) resistance level. The pair remains below this key moving average, reinforcing the bearish outlook.
The 14-day relative strength index (RSI) hovers near the midline, suggesting a period of consolidation could take place before the next directional move.
Support Levels to Watch
First support: 84.78 (May 26 low)
Next support: 84.61 (May 12 low)
Psychological and trend channel support: 84.00
A break below these levels may open the door to further declines.
Resistance Levels to Monitor
Immediate resistance: 100-day EMA at 85.55
Upper trend channel boundary: 85.75
May 22 high: 85.10
A sustained push above the 100-day EMA could signal a bullish reversal, with potential targets at the upper trend channel and recent highs.
Traders should monitor key U.S. economic releases and Fed speeches, along with crude oil price trends, as these factors will influence USD/INR movements in the near term.
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