Rupee dips tracking Asia FX, eyes Fed chief testimony this week

The Indian rupee fell slightly due to the weaker Asian currencies, while investors will seek indications on the Federal Reserve rate hike plans from Chair Jerome Powell’s congress testimony. The USD/INR pair is not expected to fall sharply as Asian currencies are weak, while investors are anticipating two more rate hikes in 2023. However, weak activity and employment and inflation moderation may dampen such expectations, and weaker economic data may persuade the Fed that it does not require a final hike in September.