USD/INR flat lines ahead of India PMI data

• Indian Rupee trades flat in Wednesday’s Asian trading hours. 
• Possible RBI interventions and lower crude oil prices might support the INR, while firmer USD could limit its upside. 
• Investors await the HSBC India Services PMI on Wednesday for fresh impetus. 

The Indian Rupee (INR) holds steady on Wednesday. Traders remain vigilant for potential interventions from the Reserve Bank of India (RBI) to prevent the INR from breaching the 84 mark, though this has yet to be officially confirmed. Meanwhile, a fall in crude oil prices to the lowest since January might underpin the local currency as India is the world's third-largest oil-consuming and importing nation. 

Nonetheless, the renewed demand for the US Dollar (USD) from importers and risk aversion could weigh on the INR and boost the safe-haven currency like the Greenback. Looking ahead, the HSBC India Services Purchasing Managers Index (PMI) is due on Wednesday. On the US docket, JOLTS Job Openings and Fed Beige Book will be published. The attention will shift to the US Nonfarm Payrolls (NFP) for August on Friday, which might offer some hints about the size and pace of rate cuts by the Federal Reserve (Fed) this year. 

Daily Digest Market Movers: Indian Rupee remains fragile amid multiple headwinds

• The World Bank has raised India's growth forecast to 7% for the current financial year (FY25), up from an earlier projection of 6.6%. 
• The RBI Deputy Governor Michael Patra said India will need rapid economic growth for a decade in order to achieve Prime Minister Narendra Modi’s goal of becoming a developed country by 2047.
• HSBC India Services PMI is expected to improve to 60.4 in August from 60.3 in July. 
• The business activity in the US manufacturing sector continued to contract, albeit at a softer pace in August. The US ISM Manufacturing PMI rose to 47.2 in August versus 46.8 prior, weaker than expected. 
• Financial markets have priced in around 61% odds of a 25 basis points (bps) rate cut by the Fed in September, while the possibility of a 50 bps reduction stands at 39%, according to the CME FedWatch tool. 

Technical Analysis: USD/INR is in consolidative mode, a longer-term bullish outlook remains in play

The Indian Rupee trades weaker on the day. The USD/INR pair remains traded in a consolidative mode in the near term. However, in the longer term, the positive view of the pair prevails as the price is well-supported above the key 100-day Exponential Moving Average (EMA) on the daily timeframe, with the 14-day Relative Strength Index (RSI) standing in bullish territory near 58.0. 

The 84.00 psychological figure appears to be a tough nut to crack for USD/INR. A decisive break above this level could pave the way to 84.50.

In the bearish event, the initial support level emerges at 83.84, the low of August 30. A breach of the mentioned level could lead to some downside, possibly dragging the pair lower to the 100-day EMA at 83.62.