Indian two thousand rupee banknotes are arranged for a photograph in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Money Market Watchlist: Inflation, Balance Of Trade, China GDP

The Indian rupee posted its first weekly loss in nine, as rising oil prices stoked concerns about accelerating inflation and a wider budget deficit.

Retail inflation soared to a 17-month high at 5.2 percent in December, higher than previous month’s 4.9 percent, data released by Central Statistics Office on Friday evening showed. Meanwhile, India’s industrial output grew near two-year high at 8.4 percent in November, powered by a robust manufacturing sector.

The country’s foreign exchange reserves surged by $1.8 billion to mount a new record high of $411.1 billion in the week to Jan. 5, according to data released by the Reserve Bank of India.

On the global front, the dollar was broadly weaker against its major traded rivals. The index was down 1 percent, after slipping to a four-month low of 90.95.

The U.S. Commerce Department said that retail sales rose 0.4 percent in December, in line with expectations. A separate report showed that that the U.S. consumer price index rose 0.1 percent in December, below forecasts for a 0.2 percent increase. Consumer prices increased 2.1 percent last month year-on-year.

The euro’s rise also weighed on the dollar index. The common currency extended its gains on hopes that European Central Bank policymakers are preparing to reduce their vast monetary stimulus programme.

Investors will be turning their attention to domestic inflation and balance of trade data this week. Globally, Asian currencies will react to China’s fourth quarter economic growth data.

Ahead of the coming week, following events are likely to affect the currencies markets:

Money Market Watchlist: Inflation, Balance Of Trade, China GDP