EUR/INR Outlook: Slightly positive, but likely to move sideways, as the rate is above its recent average but lacks a clear driving force.
Key drivers:
• The European Central Bank has kept its monetary policy cautious while the economy shows slight growth, which could support the euro against the rupee.
• Oil prices are currently above their three-month average, which could lend some strength to the euro, though the overall impact remains mixed.
• Foreign portfolio outflows from India have weakened the rupee, but strong U.S. economic data is drawing investors away from emerging markets, creating uncertainty.
Range: The euro is expected to drift within its recent 3-month range, facing fluctuations as both currencies react to global market trends.
What could change it:
• Upside risk: A significant rebound in German retail sales could boost the euro in the short term.
• Downside risk: Further foreign outflows or escalated tensions impacting global trade could add pressure to the rupee, negatively affecting the EUR/INR rate.