The Indian Rupee (INR) is trading stronger against the US Dollar (USD) as the USD exhibits weakness. The Organization for Economic Co-operation and Development (OECD) recently revised India’s growth outlook for the fiscal year 2024–25 (FY25) upward to 6.2%, up from its earlier forecast of 6.1% made in November. This positive revision reflects confidence in India’s economic prospects. However, concerns about geopolitical tensions in the Middle East, particularly disruptions in Red Sea shipping that could impact consumer prices, continue to linger.

Market attention is focused on speeches by Federal Reserve officials this week, as well as the upcoming monetary policy decision by the Reserve Bank of India (RBI). The RBI’s monetary policy meeting is scheduled from Tuesday to Thursday, with RBI Governor Shaktikanta Das set to announce the Monetary Policy Committee’s decision on Thursday at 4:30 GMT.

In terms of recent market movements, foreign investors have shown interest in Indian assets, with $936 million inflows into Indian bonds in February and an additional $275 million inflows into local equities. Despite some vulnerability, the Indian rupee has appreciated by 0.2% against the US Dollar since the beginning of the year, partly due to diminished expectations for an early rate cut by the Federal Reserve, which has bolstered the USD.