USD/INR to attract bids near 76.00 as oil prices rebound

• USD/INR may find bids near 76.00 amid a rebound in oil prices.
• Rising hopes of progress in the Russia-Ukraine peace talks have undermined the DXY.
• The risk-on impulsive has underpinned the risk-perceived currencies.

The USD/INR pair is likely to attract significant bids near 76.00 as oil prices have rebounded from $110.00 after failing to surpass $115.00. India, being a major oil importer holds an inverse relationship with oil prices.

The oil prices are trading positive in the Asian session as investors shrugged off the delay of the European Union (EU) embargo on Russian oil. The EU leaders summit on Thursday ended without any decision on banning the Russian oil imports and EU members dropped mixed responses on the agenda. Economies like Germany and Belgium, which have a higher dependency on Russian fossil fuels rather than the average import figures of the EU have cited concerns. The former believes that an immediate ban on Russian oil may send the European economy into recession. Apart from the event, oil prices are in a strong bull run amid a wide deviation in the demand-supply mechanism.

Meanwhile, the US dollar index (DXY) is auctioning near the day low at 98.52 amid an improvement in the demand for risk-sensitive currencies. Rising hopes for progress in peace talks between Russia and Ukraine have brought some offers in the greenback. Adding to that, the impact of a 50 basis point (bps) interest rate hike expectation by the Federal Reserve (Fed) in May monetary policy has been trimmed.

Although headlines from the Russia-Ukraine peace talks will remain a major driver, investors will also focus on the US Pending Home Sales data and Michigan Consumer Sentiment Index, which are due on Friday.