USD/INR pares gains as India cut EU car import tariffs

💡 DMK Insight

The USD/INR’s struggle to break past 91.96 is a key moment for traders. With the Indian Rupee gaining traction from tariff reductions on EU car imports, this could signal a shift in market sentiment. The reduction from 110% to 40% not only boosts consumer sentiment but could also enhance trade relations, potentially leading to a stronger INR. Traders should watch for a sustained move below the 91.50 level, which could indicate further weakness in the USD against the INR. Conversely, if the USD/INR breaks above 92.00, it could trigger a wave of selling in the INR, as traders rush to hedge against further dollar strength. It’s worth noting that while the current sentiment is positive, geopolitical factors and inflation data could quickly change the narrative. Keep an eye on upcoming economic releases from both the U.S. and India, as they could add volatility to this pair. The next few sessions will be crucial for determining the short-term direction of USD/INR.