Latest economic reports shows that hard economic data is not living up to the expectations of economists as soft data such as sentiment pointed to. The new government at the center brought new hopes over Indian economy as the government launched several projects such as 'Make in India', 'Digital India' , lowered taxes on corporates to encourage more businesses.

While sentiment has been high and companies like Foxconn, largest supplier to Apple promised to make India its one of the largest manufacturing Hub, hard data is hardly providing any evidence of improved growth.

Yesterday growth number showed India grew at 7% in first quarter compared to analysts' estimate of 7.5% growth.

Today manufacturing PMI report showed further slowdown in activity in the sector, with headline PMI dropping to 52.3 in August from 52.7 in July. New orders growth from abroad and home has slowed further.

Due to lack of majority in upper House the government hasn't been able to pass crucial reforms and might remain in deadlock ill 2017.

Indian Rupee is still hasn't recovered from its recent slump over China' devaluation of currency. While further retracement is possible if the concern over China subsides.

USDINR is currently trading at 66.31.