USD/INR softens on MSCI rebalancing and weaker US Dollar

The Indian Rupee gains momentum in Monday’s Asian session. 

Expected inflows from MSCI's index rebalancing support the INR, but portfolio outflows and a stronger USD might cap its gains. 

The US Chicago Fed National Activity Index and Dallas Fed Manufacturing Business Index are due later on Monday. 

The Indian Rupee (INR) extends the rally on Monday, bolstered by the weakening of the Greenback and expected inflows from MSCI's index changes. However, continuous foreign outflows, renewed strength in the US Dollar (USD) and higher crude oil prices might create a headwind for the local currency and cap its upside. 

Traders will keep an eye on the US Chicago Fed National Activity Index and Dallas Fed Manufacturing Business Index, which will be published on Monday. Later this week, the US Core Personal Consumption Expenditures (PCE) Price Index and preliminary Gross Domestic Product (GDP) Annualized for the third quarter (Q3) will be in the spotlight.