USD/INR Price News: Rupee bulls struggle above 74.00 despite Moody’s comments on Indian GDP

• USD/INR consolidates uptick to fresh two-month high, stays mildly bid for second consecutive day.
• Moody’s rejects economic fears from India’s second covid wave, says losses will be limited.
• US dollar rebound gains more accolades ahead of the key PMIs.

USD/INR eases to 74.24, following the run-up to refresh the two-month top, amid the initial Indian trading session on Wednesday. Even so, the Indian rupee (INR) pair stays positive for the second day in the row despite Moody’s upbeat analysis of the Indian economy.

The global rating giant initially said, “Economic shocks from the second covid wave in India will not be as severe as last year's,” before confirming that the economic impact of virus resurgence in India likely to be concentrated in the current quarter. Moody’s also added, “Faster vaccination progress in India will be paramount in restricting economic losses to the current quarter.”

The economic analysis also forecasts India’s real GDP to grow at 9.6% in 2021 and 7.0% in 2022 while saying, “Virus resurgence adds uncertainty to India's growth forecast for 2021.”

Elsewhere, markets returned to the US dollar buying as Fed Chairman Powell seemed to fail in convincing the bears expecting rate hike and tapering. Also on the same side could be comments from China warning the US warships in the Taiwan Strait.

Amid these plays, Asia-Pacific equities are mildly bid but the US Treasury yields trim the previous day’s losses by the press time.

Moving on, the preliminary readings of the US Markit PMIs for June will be the key as traders await more clues to confirm the recently dovish rhetoric from the Fed policymakers.

Technical analysis

Although a clear break of 50-day SMA, around 73.65, keeps USD/INR bulls hopeful, mid-April tops near 75.05 become a tough nut to crack for them.