Forex News
- The Indian Rupee strives for a temporary ground against the US Dollar, despite the increase in import duty on Gold and Silver.
- Fears of prolonged Hormuz closure are expected to keep oil prices elevated.
- The US Dollar gains as hot inflation data lifts hawkish Fed bets.
The Indian Rupee (INR) strives to regain ground against the US Dollar (USD) on Wednesday. The USD/INR pair is almost flat, close to its all-time high of 95.70, even as the increase in import duty on Gold and Silver to 15% from 6% by the Indian government.
Import duty on precious metals increases to 15% from 6%
India’s Department of Revenue under the Customs Act released a notification overnight that reflected a significant increase in the import tariffs on Gold and Silver to 15%. The notification also showed that Gold and Silver findings - small components such as hooks, clasps, clamps, pins, and screw backs used in jewellery manufacturing will now attract 5% customs duty.
Market participants had anticipated that the Indian government could hike import duty on precious metals, in an attempt to curb imports of bullion to ease pressure on the country’s foreign exchange reserves.
Over the weekend, Indian Prime Minister (PM) Narendra Modi urged citizens to postpone their non-essential gold purchases for almost a year while warning that India’s forex reserves are draining due to geopolitical tensions. Indian PM Modi also urged reducing fuel consumption and avoiding foreign travel.
The ongoing US-Iran deadlock keeps oil prices broadly higher
In the Asian trade, the WTI Oil price has corrected to near $97.20, but is still over 6% higher so far this week, as negotiations between the United States (US) and Iran failed to achieve a breakthrough. US President Donald Trump rebuffed Iran’s counterproposal, calling it “totally unacceptable” first and then terming it a “stupid proposal”.
Meanwhile, Iran remains firm on its demands regarding a permanent resolution with the US and the reopening of the Strait of Hormuz. Iran’s deputy foreign minister, Kazem Gharibabadi, said earlier in the day that Iran’s position was that any peace deal must include reparations for Iran, Iranian sovereignty over the Strait of Hormuz, and an end to US sanctions.
Speaking at a conference in Switzerland late on Tuesday, Reserve Bank of India (RBI) Governor Sanjay Malhotra said that the government may need to hike oil prices if Middle East tensions drag on, Reuters reports. Malhotra added, "Central banks need to be cautious, follow a policy of "gradualism" in the face of heightened uncertainty."
FIIs continue to remain net sellers
Amid growing concerns regarding India Inc.’s earnings projections due to higher energy prices, foreign investors continue to dump their stake in the Indian stock market. So far in May, Foreign Institutional Investors (FIIs) have remained net sellers in six of seven trading days and have offloaded their stake worth Rs. 21,469.30 crore.
A higher US Dollar could strengthen USD/INR further
While a sudden hike in import duty on precious metals has put slight pressure on USD/INR, the pair could extend its ongoing rally as hot US inflation data for April has strengthened the US Dollar. During the press time, the US Dollar Index (DXY) is close to its weekly high of 98.46 posted on Tuesday.
The data showed on Wednesday that the US headline CPI grew at an annualized pace of 3.8%, stronger than estimates of 3.7% and the March reading of 3.3%. Signs of further acceleration in inflationary pressures have prompted expectations of interest rate hikes by the Federal Reserve (Fed) this year.
Technical Analysis: USD/INR holds close to all-time high near 95.70
USD/INR trades almost flat at around 95.70, maintaining a bullish near-term bias as spot holds firmly above the 20-period Exponential Moving Average (EMA) at 94.55. The pair has been carving out higher closes in recent sessions, and the Relative Strength Index (14) around 65 suggests persistent upward momentum, though edging toward overbought territory.
On the downside, initial support is now seen at the 20-period EMA near 94.56, which acts as the first line of demand should any corrective pullback unfold. Looking up, the pair is in uncharted territory and could gain further toward 96.00
(The technical analysis of this story was written with the help of an AI tool.)
Indian economy FAQs
The Indian economy has averaged a growth rate of 6.13% between 2006 and 2023, which makes it one of the fastest growing in the world. India’s high growth has attracted a lot of foreign investment. This includes Foreign Direct Investment (FDI) into physical projects and Foreign Indirect Investment (FII) by foreign funds into Indian financial markets. The greater the level of investment, the higher the demand for the Rupee (INR). Fluctuations in Dollar-demand from Indian importers also impact INR.
India has to import a great deal of its Oil and gasoline so the price of Oil can have a direct impact on the Rupee. Oil is mostly traded in US Dollars (USD) on international markets so if the price of Oil rises, aggregate demand for USD increases and Indian importers have to sell more Rupees to meet that demand, which is depreciative for the Rupee.
Inflation has a complex effect on the Rupee. Ultimately it indicates an increase in money supply which reduces the Rupee’s overall value. Yet if it rises above the Reserve Bank of India’s (RBI) 4% target, the RBI will raise interest rates to bring it down by reducing credit. Higher interest rates, especially real rates (the difference between interest rates and inflation) strengthen the Rupee. They make India a more profitable place for international investors to park their money. A fall in inflation can be supportive of the Rupee. At the same time lower interest rates can have a depreciatory effect on the Rupee.
India has run a trade deficit for most of its recent history, indicating its imports outweigh its exports. Since the majority of international trade takes place in US Dollars, there are times – due to seasonal demand or order glut – where the high volume of imports leads to significant US Dollar- demand. During these periods the Rupee can weaken as it is heavily sold to meet the demand for Dollars. When markets experience increased volatility, the demand for US Dollars can also shoot up with a similarly negative effect on the Rupee.
Silver prices (XAG/USD) fell on Wednesday, according to FXStreet data. Silver trades at $86.28 per troy ounce, down 0.34% from the $86.57 it cost on Tuesday.
Silver prices have increased by 21.38% since the beginning of the year.
Unit measure | Silver Price Today in USD |
|---|---|
Troy Ounce | 86.28 |
1 Gram | 2.77 |
The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, stood at 54.39 on Wednesday, down from 54.46 on Tuesday.
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
(An automation tool was used in creating this post.)
- The Australian Dollar gains against its major peers amid rising hawkish RBA bets.
- Investors will pay close attention to the Trump-Xi meeting outcome.
- Accelerating hawkish Fed bets have strengthened the US Dollar.
The Australian Dollar (AUD) trades higher against its major currency peers, flattening against the US Dollar (USD) around 0.7240, during the European trading session on Wednesday. The antipodean strengthens as market expectations for the Reserve Bank of Australia (RBA) raising its Official Cash Rate (OCR) in the August policy meeting after the budget 2026 announcement on Tuesday.
Australian Dollar Price Today
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.36% | 0.21% | 0.17% | 0.07% | 0.05% | 0.46% | 0.29% | |
| EUR | -0.36% | -0.15% | -0.18% | -0.31% | -0.32% | 0.10% | -0.10% | |
| GBP | -0.21% | 0.15% | -0.04% | -0.14% | -0.15% | 0.28% | 0.08% | |
| JPY | -0.17% | 0.18% | 0.04% | -0.09% | -0.12% | 0.27% | 0.13% | |
| CAD | -0.07% | 0.31% | 0.14% | 0.09% | -0.02% | 0.40% | 0.21% | |
| AUD | -0.05% | 0.32% | 0.15% | 0.12% | 0.02% | 0.43% | 0.23% | |
| NZD | -0.46% | -0.10% | -0.28% | -0.27% | -0.40% | -0.43% | -0.19% | |
| CHF | -0.29% | 0.10% | -0.08% | -0.13% | -0.21% | -0.23% | 0.19% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
Markets still imply around a 20% chance of a June hike to the 4.35% cash rate, but the probability of an August hike to 4.60% nudged further above 80%, according to a Reuters report.
In the 2026 budget, Australian Treasurer Jim Chalmers lowered tax rate for citizens having income between $18,201 and $45,000 to 15% from July 2026, a move that will leave general public with higher purchasing power and boosts inflation expectations in an already high-inflation economy.
Meanwhile, investors await the meeting between United States (US) President Donald Trump and Chinese leader Xi Jinping during Trump’s visit to Beijing on May 13-15. Given that the Australian economy relies meaningfully on its exports to Beijing, the outcome of the Trump-Xi meeting will have a significant impact on the Australian Dollar.
During the day, the US Dollar also trades firmly due to increased expectations of at least one interest rate hike by the Federal Reserve (Fed) this year. As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.3% higher to near 98.58, the highest level so far this month.
RBA FAQs
The Reserve Bank of Australia (RBA) sets interest rates and manages monetary policy for Australia. Decisions are made by a board of governors at 11 meetings a year and ad hoc emergency meetings as required. The RBA’s primary mandate is to maintain price stability, which means an inflation rate of 2-3%, but also “..to contribute to the stability of the currency, full employment, and the economic prosperity and welfare of the Australian people.” Its main tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will strengthen the Australian Dollar (AUD) and vice versa. Other RBA tools include quantitative easing and tightening.
While inflation had always traditionally been thought of as a negative factor for currencies since it lowers the value of money in general, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Moderately higher inflation now tends to lead central banks to put up their interest rates, which in turn has the effect of attracting more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in the case of Australia is the Aussie Dollar.
Macroeconomic data gauges the health of an economy and can have an impact on the value of its currency. Investors prefer to invest their capital in economies that are safe and growing rather than precarious and shrinking. Greater capital inflows increase the aggregate demand and value of the domestic currency. Classic indicators, such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can influence AUD. A strong economy may encourage the Reserve Bank of Australia to put up interest rates, also supporting AUD.
Quantitative Easing (QE) is a tool used in extreme situations when lowering interest rates is not enough to restore the flow of credit in the economy. QE is the process by which the Reserve Bank of Australia (RBA) prints Australian Dollars (AUD) for the purpose of buying assets – usually government or corporate bonds – from financial institutions, thereby providing them with much-needed liquidity. QE usually results in a weaker AUD.
Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the Reserve Bank of Australia (RBA) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the RBA stops buying more assets, and stops reinvesting the principal maturing on the bonds it already holds. It would be positive (or bullish) for the Australian Dollar.
Commerzbank’s economists, led by Dr. Henry Hao, note that India’s April Consumer Price Index (CPI) rose 3.5% year-on-year, marking a fifteenth month below the Reserve Bank of India's (RBI) 4% mid-point target. Government measures have so far cushioned Oil-related pressures, but the bank expects inflation to edge higher as fiscal space narrows, relief measures are normalised, and adverse weather lifts Food prices.
Relief measures face fiscal limits
"April CPI rose less than expected by 3.5% yoy (Bloomberg consensus: 3.8%) vs 3.4% in March. It marked the fifteenth consecutive month that inflation remained below the Reserve Bank of India’s (RBI) 4% mid-point target. In the first four months of the year, inflation averaged 3.2%, below the RBI’s 4.6% forecast for fiscal year 2026-2027 (FY2026-2027). Government policies helped to contain broader inflationary pressures from higher global oil prices."
"Looking ahead, inflation is expected to rise in the coming months as the government faces limited fiscal space to sustain the current relief measures. Following strong state election results, Prime Minister Narendra Modi openly urged citizens to reduce electricity usage and rely more on public transport, suggesting that some relief measures could soon be normalised to ease pressure on public finances. Food prices are also likely to rise as unfavourable weather conditions weigh on agricultural production."
"Food inflation rose 4.0% yoy in April vs 3.7% in March, as spring harvest crop yields were partly damaged by heavier-than-expected rainfall. Food prices are expected to remain elevated amid a hotter and drier summer, while supply chain disruptions continue to raise fertiliser costs."
"Liquefied petroleum gas (LPG), which is used for cooking, rose 3.0% vs 5.3% in March. Although caps on consumer LPG prices were unchanged, commercial LPG prices increased as crack spreads widened. Transport fuel inflation remained benign at 0.1% yoy in April, unchanged from March."
"Core CPI, which excludes food and fuel prices, rose 3.7% yoy, unchanged from March. Higher precious metal prices partly drove the reading, and, excluding jewellery, it rose 2.2% vs 2.1% previously."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- NZD/USD is testing support at the 0.5930 area after rejection at 0.5967.
- Hot US inflation figures and concerns about the US-Iran deadlock are underpinning the US Dollar.
- The Kiwi depreciated after the release of the RBNZ's inflation expectations earlier on Wednesday.
The New Zealand Dollar (NZD) is showing the weakest performance of the G8 currencies on Wednesday, heading lower for the second consecutive day against a stronger US Dollar (USD), with NZD/USD bears testing the bottom of the weekly range at 0.5930 at the time of writing.
The US Dollar is drawing support from waning hopes of further Federal Reserve (Fed) rate cuts, following strong US Consumer Price Index (CPI) figures on Tuesday, and investors’ concerns about the stalemate in the US-Iran conflict. In New Zealand, the increase in the Reserve Bank of New Zealand’s (RBNZ) Inflation Expectations has failed to support the Kiwi.
Technical Analysis: Below 0.5930, the next target is the 0.5870 area
NZD/USD shows a slightly offered near-term tone on Wednesday. The 4-hour Relative Strength Index (RSI) has dropped below the 50 line with a negative Moving Average Convergence Divergence (MACD) histogram, reinforcing the view of a waning bullish momentum after the recent pullback.
Bears are testing support in the area between 0.5925 and 0.5935 (April 17 and May 4 highs and May 8 and 12 lows). If this area gives way, the next bearish target will be the May 5 intraday low, right above 0.5870. Further down, the April 29 low, at 0.5815.
On the topside, immediate resistance emerges at the 0.5970 area, which held bulls on May 8 and 11, ahead of the May 6 high at 0.5991.
(The technical analysis of this story was written with the help of an AI tool.)
New Zealand Dollar Price Today
The table below shows the percentage change of New Zealand Dollar (NZD) against listed major currencies today. New Zealand Dollar was the strongest against the Euro.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.26% | 0.09% | 0.11% | 0.04% | 0.00% | 0.37% | 0.19% | |
| EUR | -0.26% | -0.18% | -0.15% | -0.22% | -0.27% | 0.09% | -0.10% | |
| GBP | -0.09% | 0.18% | 0.02% | -0.04% | -0.08% | 0.29% | 0.09% | |
| JPY | -0.11% | 0.15% | -0.02% | -0.07% | -0.11% | 0.22% | 0.09% | |
| CAD | -0.04% | 0.22% | 0.04% | 0.07% | -0.04% | 0.32% | 0.13% | |
| AUD | -0.00% | 0.27% | 0.08% | 0.11% | 0.04% | 0.37% | 0.19% | |
| NZD | -0.37% | -0.09% | -0.29% | -0.22% | -0.32% | -0.37% | -0.17% | |
| CHF | -0.19% | 0.10% | -0.09% | -0.09% | -0.13% | -0.19% | 0.17% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the New Zealand Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent NZD (base)/USD (quote).
tone on
Rabobank’s Senior Macro Strategist Bas van Geffen notes that concerns over the Middle East and the closure of the Strait of Hormuz have pushed Oil prices higher, with Dated Brent moving above $111. He highlights that Iran’s control over energy flows and China’s diversification of Oil imports could prolong disruptions, keeping upward pressure on Oil in coming days.
Hormuz closure drives Brent higher
"Concerns about the Middle East continued to dictate markets yesterday. The Strait of Hormuz remains closed, and there were no signs that this will change soon. Oil prices rose further."
"Dated Brent jumped 5% on the day to top $111."
"Meanwhile, Iraq and Pakistan have reportedly made deals with Iran to safeguard oil and LNG shipments from the Gulf – underscoring that Iran is able to effectively control the flow of energy through the Strait of Hormuz."
"China has also further diversified its oil imports."
"This may make China more resilient to prolonged disruptions in Hormuz, while it also cuts off more potential income for Iran."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
The Eurozone industrial sector activity rises steadily by 0.2% in March, slower than 0.3% estimates, according to data published by Eurostat. February’s Industrial Production data was revised lower from 0.4%.
On an annualized basis, the industrial output declined at a faster pace of 2.1% against -1.7% expectations. In February, the Industrial Production contracted by 0.8%, revised lower from -0.6%.
Market reaction
There seems to be no immediAte impact of weak Eurozone Industrial Production data on the Euro (EUR). As of writing, EUR/USD trades 0.3% lower to near 1.1700 due to the upbeat US Dollar (USD).
Euro FAQs
The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
Forex Market News
Our dedicated focus on forex news and insights empowers you to capitalise on investment opportunities in the dynamic FX market. The forex landscape is ever-evolving, characterised by continuous exchange rate fluctuations shaped by vast influential factors. From economic data releases to geopolitical developments, these events can sway market sentiment and drive substantial movements in currency valuations.
At Rakuten Securities Hong Kong, we prioritise delivering timely and accurate forex news updates sourced from reputable platforms like FXStreet. This ensures you stay informed about crucial market developments, enabling informed decision-making and proactive strategy adjustments. Whether you’re monitoring forex forecasts, analysing trading perspectives, or seeking to capitalise on emerging trends, our comprehensive approach equips you with the insights needed to navigate the FX market effectively.
Stay ahead with our comprehensive forex news coverage, designed to keep you informed and prepared to seize profitable opportunities in the dynamic world of forex trading.
