​​USD/INR remains flat ahead of US Fed rate decision

• Indian Rupee holds steady in Wednesday's Asian session. 
• Firmer Fed rate cuts bets and robust USD sales weigh on the pair, but higher oil prices might cap its downside. 
• The Fed rate decision will be in the spotlight on Wednesday. 

The Indian Rupee (INR) trades on a flat note on Wednesday after climbing to a month-high of 83.75 in the previous session. The downtick of the pair is pressured by the rising expectations of a deeper Federal Reserve (Fed) rate cut and robust US Dollar sales. Nonetheless, the extended recovery of crude oil prices might undermine the local currency and help limit USD/INR losses. 

Later on Wednesday, all eyes will be on the Fed interest rate decision, which is widely expected to cut the rate in its September meeting. Fed officials will also release a Summary of Economic Projections, or 'dot-plot' after the policy meeting, which could give insight into just how much the US central bank plans to cut over the next year. The expectation of the jumbo rate cuts might exert some selling pressure on the Greenback in the near term. 

Daily Digest Market Movers: Indian Rupee flatlines ahead of US key event

• India's Wholesale Price Index (WPI)-based inflation declined to a four-month low of 1.31% YoY in August from 2.04% in the previous reading. This figure came in below the market consensus of 1.80%.
• India's merchandise trade deficit stood at $29.65 billion in August compared with $23.5 billion in July, according to Ministry of Commerce and Industry data released on Tuesday.
• India's foreign exchange reserves rose to a record high of $689.2 billion as of September 6, according to the Reserve Bank of India (RBI).
• The US Retail Sales unexpectedly rose 0.1% MoM in August versus 1.1% prior, above the market consensus of -0.2%. Industrial Production climbed 0.8% MoM in August, compared to a decline of 0.6% in the previous reading, better than the estimation of 0.2%. 
• According to the CME Fedwatch Tool, Fed funds futures have priced in nearly 63% probability of a 50 basis points (bps) rate cut, up from 30% a week ago, while the chance of a 25 bps cut was at 37%. 

Technical Analysis: USD/INR's positive outlook prevails in the longer term

The Indian Rupee trades flat on the day. The USD/INR pair oscillates within the rectangle on the daily chart. However, in the longer term, the pair keeps the bullish vibe as the price holds above the key 100-day Exponential Moving Average (EMA). Further downside cannot be ruled out as the 14-day Relative Strength Index (RSI) stands in the bearish zone below the midline, supporting the sellers for the time being.

The 83.90-84.00 zone appears to be a tough nut to crack for USD/INR buyers. This region portrays the upper boundary of the rectangle and psychological mark. A break above the mentioned level will see the next upside barrier at 84.50.

On the flip side, the initial support level is located at the low of September 17 at 83.70. A breach of this level will pave the way to the 100-day EMA at 83.64.