HKD/INR Outlook:
Slightly positive, but likely to move sideways as the rate is above its recent average and trading comfortably within the 3-month range.
Key drivers:
• The Hong Kong Monetary Authority (HKMA) has recently intervened to support the HKD, stabilizing interest rates amid a pressured currency environment.
• Fluctuating oil prices impact the Indian economy, affecting the INR due to India's heavy dependence on crude imports.
• India's persistent current account deficit continues to drag on the INR, driven by a widening trade gap and weak manufacturing export growth.
Range:
The HKD/INR is likely to hold steady within the established range, with minor fluctuations expected as both currencies respond to economic developments.
What could change it:
• A significant increase in investor confidence in India's economy could strengthen the INR against the HKD.
• Continued or heightened geopolitical tensions may further pressure the INR, leading to downward movement against the HKD.