{"id":439377,"date":"2026-10-05T19:22:39","date_gmt":"2026-10-05T12:22:39","guid":{"rendered":"https:\/\/www.swingfish.trade\/blog\/market-news\/indian-rupee-approaches-record-lows-amid-safe-haven-flows-into-us-dollar-prolonged-us-iran-stalemate-439377\/"},"modified":"2026-10-05T19:22:39","modified_gmt":"2026-10-05T12:22:39","slug":"indian-rupee-approaches-record-lows-amid-safe-haven-flows-into-us-dollar-prolonged-us-iran-stalemate","status":"publish","type":"post","link":"https:\/\/www.swingfish.trade\/blog\/market-news\/indian-rupee-approaches-record-lows-amid-safe-haven-flows-into-us-dollar-prolonged-us-iran-stalemate-439377\/","title":{"rendered":"Indian Rupee approaches record lows amid safe haven flows into US dollar, prolonged US-Iran stalemate"},"content":{"rendered":"
\n

FUNDAMENTAL
\n OVERVIEW<\/p>\n

\u00a0<\/p>\n

USD:<\/p>\n

The US dollar has
\n been supported recently despite a dovish repricing triggered by Fed\u2019s Williams
\n and Fed\u2019s Jefferson comments that pushed back against expectations of a rate
\n hike in October. <\/p>\n

The main
\n reason might be risk-off flows into the greenback due to European debt concerns.
\n The focus has been particularly on France, where political uncertainty and
\n concerns over the country’s large fiscal deficit have pushed French government
\n bond yields higher and widened the spread over German Bunds to its highest
\n level since the eurozone debt crisis. <\/p>\n

A stabilization in French spreads could allow some of the euro’s risk
\n premium to unwind and trigger a pullback in the US dollar, while further
\n widening and contagion to other countries would likely keep the greenback
\n supported.<\/p>\n

Moreover, the US-Iran negotiations continue to be at a stalemate and with a
\n light calendar this week, the focus will probably remain on the Middle East.<\/p>\n

A breakthrough would be negative for the US
\n dollar as the aggressive rate hike bets will likely get pared back. A prolonged
\n stalemate or even a re-escalation, on the other hand, will likely continue to
\n support the greenback into new highs.<\/p>\n

\u00a0<\/p>\n

INR:<\/p>\n

On the INR side, the
\n rupee has decoupled from oil prices last week as the currency weakened further
\n despite no major move in the crude market. Nevertheless, oil prices continue to
\n be the main driver for the rupee since India imports most of its crude, so a
\n larger oil bill increases demand for dollars, widens the trade deficit and puts
\n downward pressure on the INR.<\/p>\n

On Wednesday, we
\n have the RBI rate decision. In the latest Reuters poll, 35 of 61 economists
\n (57%) expected a hike, while swap markets were already fully pricing one. The expectations
\n increased after the August CPI rose to 4.82%, above the RBI’s 4% target for the
\n third consecutive month. <\/p>\n

More importantly,
\n the increase is becoming broader rather than being confined to a few
\n components. With growth remaining strong, oil prices staying elevated and a global
\n hiking cycle, traders expect the RBI to follow suit, especially given the Rupee\u2019s
\n slide this year. <\/p>\n

In the short-term,
\n the INR will continue to be driven mainly by oil prices, so the US-Iran
\n negotiations will be key. A breakthrough should give the Indian rupee a boost
\n and we might see the USD\/INR pair dropping back to the 95.10 support pretty
\n quickly. Conversely, a negative outcome or even a re-escalation, will likely continue
\n to support the pair into new highs.<\/p>\n

In the big
\n picture, the Indian Rupee remains on a bearish structural trend against the US dollar,
\n so dip-buyers will continue to look for opportunities around strong major technical
\n levels to keep pushing the USD\/INR pair into new highs. <\/p>\n

\u00a0<\/p>\n

USDINR TECHNICAL
\n ANALYSIS \u2013 DAILY TIMEFRAME<\/p>\n<\/p>\n

On the daily
\n chart, we can see that USDINR<\/a>broke above the major resistance zone around the 96.10 level and
\n extended the gains into new highs. The natural target should be the all-time high
\n around the 97.33 level. If the price gets there, we can expect the sellers to
\n step in, with a defined risk above the record highs, to position for a
\n correction into the 96.10 support. The buyers, on the other hand, will look for
\n a break to increase the bullish bets into new highs.<\/p>\n

USDINR TECHNICAL
\n ANALYSIS \u2013 4 HOUR TIMEFRAME<\/p>\n<\/p>\n

On the 4 hour
\n chart, we have an upward trendline defining the bullish momentum. If we get a
\n pullback, the buyers will likely lean on the trendline, with a defined risk
\n below it, to keep targeting new highs. The sellers, on the other hand, will
\n want to see the price breaking lower to start targeting a correction into the 95.75
\n level next.<\/p>\n

USDINR TECHNICAL
\n ANALYSIS \u2013 1 HOUR TIMEFRAME<\/p>\n<\/p>\n

On the 1 hour
\n chart, there\u2019s not much we can add here as the buyers will have a better risk
\n to reward setup around the trendline, while the sellers will need a break to start
\n targeting a pullback into the 95.75 level next. <\/p>\n

UPCOMING CATALYSTS<\/p>\n

Today<\/a>we get
\n the US ISM Services PMI. On Wednesday, we have the RBI rate decision and the FOMC
\n meeting minutes. On Thursday, we get the latest US Jobless Claims figures. On
\n Friday, we conclude the week with the University of Michigan Consumer Sentiment
\n survey.<\/p>\n

This article was written by Giuseppe Dellamotta at investinglive.com.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

FUNDAMENTAL OVERVIEW \u00a0 USD: The US dollar has been supported recently despite a dovish repricing triggered by Fed\u2019s Williams and Fed\u2019s Jefferson comments that pushed back against expectations of a rate hike…<\/p>\n","protected":false},"author":216,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[86],"tags":[],"class_list":["post-439377","post","type-post","status-publish","format-standard","hentry","category-market-news"],"_links":{"self":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/439377","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/users\/216"}],"replies":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/comments?post=439377"}],"version-history":[{"count":0,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/439377\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/media?parent=439377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/categories?post=439377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/tags?post=439377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}