Market Volatility and Risk Management
The U.S. election outcome increased market volatility, prompting calls for Indian firms to adopt more prudent forex risk management strategies. The rupee's low volatility period was expected to end, necessitating adjustments in how companies manage foreign exchange risks.
Global Economic Indicators
Global economic indicators, including inflation rates and GDP figures, continued to influence forex markets. The U.S. Consumer Price Index rose by 0.3% in November, the highest increase in seven months, with the annual CPI reaching 2.7%. Despite this rise, the Federal Reserve was expected to proceed with a planned interest rate cut due to concerns about the cooling labor market.
These developments underscore the forex market's sensitivity to geopolitical events, economic policies, and market sentiment during November 2024.