USDINR trades 0.19% lower at 70.77 close to 7-week lows as the positive implications on Indian Rupee rolls after Indian government announced a cut to corporate tax rates for domestic companies to 22%. The Reserve Bank of India (RBI) lowered its benchmark interest rate by 35 basis points to 5.40% in its August monetary policy meeting, above analysts forecast of 25 bps cut. The August cut was the fourth straight rate cut in 2019, in an attempt to boost Indias struggling growth. The Reserve Bank of India also lowered its growth forecast to 6.9% for 2020 from 7%.
USDINR Technical Analysis
On the technical analysis side, bulls and bears are fighting around the 200-day moving average. On the downside, first support stands at 70.660 today’s low, while next barrier is at 70.111 the 50-day moving average. Investors holding short positions can sit comfortably as long as the pair trades below the 71 zone. On the upside immediate resistance for USDINR stands at 70.906 today’s high, while a break above will open the way for a move up to 71.95 the high from September 20th, a convincing close above will attract more bulls and will open the way for a move to yearly highs at 72.428. For those looking to buy the Indian Rupee, an entry point can be when the pair breaks above the 200-day moving average at 70.875.