Monthly Outlook - November 2025

MONTHLY OUTLOOK

USDINR Fundamental

The USDINR pair witnessed high volatility through October, weighed by diverging domestic and global factors. The RBI kept the repo rate unchanged at 5.50%, maintaining an accommodative stance amid easing inflation and a steady growth outlook. India’s CPI eased to 1.54% in September, the lowest since 2017, driven by a steep decline in food inflation, while core inflation held around 4.2%. However, the positive inflation backdrop was offset by a sharp widening of the trade deficit to USD 32.15 billion, the largest since November 2024, led by a surge in gold and energy imports. Mid-month reports suggesting that the U.S. might reduce tariffs on Indian goods to 15–16% from the current 50% lifted market sentiment and helped the rupee strengthen to a two-month high of 87.6250. This imbalance, coupled with moderate foreign fund inflows, kept the rupee under mild pressure.

Globally, the rupee weakened in October as the Federal Reserve cut rates by 25 basis points but maintained a hawkish tone, signaling limited scope for further easing. Fed Chair Jerome Powell’s comments lifted U.S. Treasury yields and strengthened the dollar, even as the U.S. CPI came in softer. Looking ahead, the USDINR outlook remains mildly bullish, supported by a strong dollar, elevated U.S. yields, and India’s widening trade deficit. However, easing domestic inflation, steady growth, and possible RBI intervention may help limit rupee losses, keeping the pair range-bound with a slight weakening bias in the near term.

 

USDINR Technical

The USDINR pair witnessed a volatile month, trading within a broad range of 1.18 rupees. Midway through the month, the pair drifted lower to test an almost two-month low of 87.625.. However, the decline proved short-lived as renewed buying interest pushed the pair higher, eventually closing the month at 88.765. Despite this rebound, the pair continues to hover just below the critical resistance zone of 88.80, indicating consolidation near record levels.

From a technical standpoint, price action remains constructive with signs of sustained bullish momentum. The 14-day RSI is currently positioned around 61, inching upward toward the overbought mark of 70, suggesting that further appreciation in the pair cannot be ruled out. Key resistance is seen at 88.81, coinciding with the previous and all-time high, while a successful breakout above this level could extend gains toward the 89.00 psychological barrier. On the contrary, immediate support lies near the 50-day EMA at 88.06, which may cushion any near-term correction.

Considering the prevailing price levels near historical highs, exporters are advised to initiate partial hedges around 88.80 and above, maintaining a conservative hedge ratio of 20–25%, as rupee depreciation has outpaced forward premiums. Meanwhile, importers should adopt a wait-and-watch approach, entering fresh hedges only if the pair corrects below 88.06, to secure more favorable rates for near-term obligations.

EURUSD Fundamental

The EURUSD pair opened the month at 1.1733, supported by resilient Eurozone data, stable inflation near the ECB’s 2% target, and stronger than expected third quarter GDP growth that reinforced optimism about the region’s gradual recovery. The ECB maintained its policy stance for the third consecutive meeting, with President Lagarde stating that monetary policy is “in a good place,” showing confidence in current economic conditions after eight rate cuts through June. Similarly, ECB policymaker François emphasized that any adjustments would depend on rising downside risks. Mid-month, the euro fell as industrial production softened and PMI data showed uneven expansion across the region, while political uncertainty in France added to market caution. In contrast, the U.S. dollar strengthened after the Fed delivered a 25bps rate cut but adopted a cautious tone, with Chair Powell suggesting limited scope for further easing. This fueled a widening policy divergence between the Fed and the ECB, weighing on the euro. The EURUSD pair closed the month at 1.1537, marking a 1.7% decline. Looking ahead, the pair is likely to trade cautiously as policy differences and stronger U.S. yields continue to influence direction, though steady Eurozone data and firm services activity may help limit deeper losses in the near term.

 

EURUSD Technical

The EURUSD pair failed to sustain its prior month’s gains, declining 1.7% in October as bearish pressure dominated throughout the month. Although the pair attempted a mid-month recovery, it was unable to hold gains and fell to a three-month low of 1.1521 by month-end. Technical indicators reinforce the negative bias, with the pair trading below both the 50-day and 144-day SMAs, and the downside momentum intensified by a break below the symmetrical triangle support line. Immediate support is seen at the 1.1400 psychological level, and a decisive breach could expose the 200-day SMA near 1.1316, limiting further downside. Given the persistent bearish trend, Euro importers are advised to initiate partial near-term hedges and look to increase coverage around key support zones.

GBPUSD Fundamental

The GBPUSD pair weaken in October, because the U.S. economy stayed stronger while the UK economy suffers from weaker credit conditions, GBPUSD dropped to around 1.3096, marking its lowest level of the month as investors preferred the U.S. dollar due to policy differences and global risk worries. In the UK, the Bank of England stayed careful and warned that global markets could face trouble if confidence dropped. A policymaker also said the economy might face a “bumpy landing,” meaning slower growth ahead. As the Inflation stayed at 3.8%, higher than the BoE’s 2% target, showing that prices are still rising faster than expected and new worries about government finances appeared. Even though the BoE kept interest rates unchanged, its cautious message and weak economic signs made markets think rate cuts could come next year, which pressured the pound. In the U.S., the economy looked stronger. The job market remained resilient, though business activity showed signs of cooling. The Federal Reserve cut interest rates by 25bps, but made it clear that more cuts might not happen soon. This supported U.S. bond yields and made the dollar stronger. Overall, the UK’s weak outlook and the U.S.’s steady performance widened the gap between the two economies, putting the pressure on pound. Looking ahead, market participants will keep an eye on the upcoming BoE meeting in November, as GBPUSD movements will depend on policymakers’ comments, though major expectations remain centered on the December meeting.

 

GBPUSD Technical

It was a distinctly negative month for GBPUSD, as the pair extended its decline for the second consecutive month. The month began on a positive note, with the pair reaching a high of 1.3527 in the first trading session, but selling pressure dominated thereafter, forming consecutive large red candles and pushing the pair down to a 6.5-month low of 1.3096. A Doji pattern appeared toward the week’s end, indicating market indecision and potential trend exhaustion, although confirmation from subsequent price action is necessary. The broader technical structure remains bearish, highlighted by a 50-day SMA crossing below the 144-day SMA, while the MACD continues its downward trajectory, reinforcing negative momentum. Immediate support is near 1.3050, and a breach below this level could open the door for further declines. Importers are advised to hedge at current levels and consider gradually increasing hedge ratios on any dips, whereas exporters should maintain their positions and reassess as the market evolves.

USDJPY Fundamental

The USDJPY pair extended gains for the second consecutive month, beginning in October near 147.80 and climbing steadily to a nine-month high of 154.44 before easing slightly to close at 154.00. A notable up-gap between 147.82 and 149 remains a key technical level that market participants are monitoring for potential support in case of a pullback. From a technical standpoint, the 14-day RSI at 66.31 indicates the pair is approaching overbought territory, suggesting that a near-term correction could occur if it breaches the 70 level. On the upside, immediate resistance is seen at 154.86, corresponding to the previous high, while support lies at the 50-day and 100-day EMAs at 150.10 and 148.90, respectively. The pair continues to benefit from the persistent yield differential between the U.S. and Japan, coupled with sustained positive sentiment around the dollar, providing momentum for potential further gains, although markets should remain cautious of a short-term pullback given overbought conditions.

 

USDJPY Technical

It was a positive week for the USDJPY pair as it gained for the second consecutive week. The pair gained and touched a 9-month high of 154.44. Though the pair declined slightly towards the end to close the week lower at 154.00. The pair has closed above the previous week’s close, which is a positive signal. The RSI 14-Day Line can be seen trading at 66.31 levels,very close to the 70 threshold, indicating that the pair is in overbought condition, suggesting a possible correction is near-the corner in the near-term, if it breaches the 70-Threshold. If the pair continues to gain, it may face resistance at 154.86 level(previous high), preventing further upside in the pair. The support can be seen at 50-Days and 100-Days EMA at 150.10 and 148.90. With the persistent yield differential between the U.S. and Japan and the positive sentiment around dollar, the pair is expected to gain.