USD/INR EXTENDS ITS DOWN LEG AHEAD OF INDIA’S INTERIM BUDGET

• Indian Rupee trades in positive territory for the third consecutive day. 
• Chief Economic Advisor is confident that India is poised for continuous and robust economic expansion.
• Investors will closely watch India’s Interim Budget for 2024–25, followed by US PMI data on Thursday.

Indian Rupee (INR) gains traction on Thursday. The uptick in the pair is bolstered by US Dollar (USD) sales from both local and foreign banks, which boosted the INR to its strongest level in over two weeks.

The Federal Reserve (Fed) left the benchmark Federal Funds Rate unchanged in January. Fed Chair Jerome Powell stated that the upcoming inflation data will determine how soon the central bank moves ahead on rate cuts.

India's Chief Economic Advisor, V Anantha Nageswaran, highlighted in "The Indian Economy: A Review" report that macroeconomic stability will support India's continued robust economic growth. The Reserve Bank of India (RBI) forecast India’s GDP growth of 7.4% in FY24, with a slight decline in headline inflation. Factors contributing to this positive outlook include resilient service exports and reduced oil import costs.

Looking ahead, Finance Minister Nirmala Sitharaman will present India’s Interim Budget 2024–25 on Thursday. On the US docket, the US weekly Initial Jobless Claims and ISM Manufacturing PMI will be due. Another highlight this week will be the US Nonfarm Payrolls (NFP) on Friday