USD/INR: Rupee hits monthly lows at 71.10

The USD/INR pair has entered a phase of bullish consolidation near 71 handle, having fresh one-month highs at 71.10 in early trades.    

The Rupee reversed Friday’s temporary bounce and fell back into the red zone versus its American rival on the back of “chunky outflows”.  A foreign bank dealer noted: “There have been chunky outflows for the last two days. We are not sure what kind of outflows these are.”

Markets have ruled out any intervention by the Reserve Bank of India (RBI) while increased odds of monetary policy easing by the Indian central bank following disappointing Indian inflation figures also collaborated to the latest leg down in the Rupee.

Further, rising oil prices amid China stimulus talks combined with the latest bounce in the US dollar also underpinned the sentiment around the cross.

USD/INR Technical Levels