Economists at Commerzbank expect the USD/INR pair to continue trading within the 80-83.50 range for the time being.

Robust services sector

“The S&P Global services PMI for February rose strongly to 59.4 from 57.2 in January. It continues to point to resilient and robust domestic demand in India.”

“RBI will welcome the good news. However, RBI may still need to hike further to keep a lid on inflation expectations. We still look for another 25-50 bps in rate hikes this year. This should provide some support for INR.” 

“USD/INR has held within the 80-83.50 range for the past five months or so and we look for continued consolidation within this range near term.”