FX – MORNING UPDATE :
FX Morning Update USD INR February 6, 2024
USDINR opened at 83.02 y’day and the pair traded in the 83-83.08 range. Spot USDINR closed at 83.04, gain of 13 ps for USD as against prior close of 82.91.
Thank you for reading this post, don't forget to subscribe!RBI reference rate was fixed at 83.02 on 05/02. Feb USD/INR closed at 83.11, gain of 13 ps for USD as compared to prior day’s close of 82.98. Feb Euro/INR closed at 89.52, GBP/INR at 104.68 and Yen/INR at 56.25. 1 year USDINR fwd premia was trading at around 1.78% p.a. FX reserves stood at USD 616.73 bn, as on Jan 26 th.
|
PAIRS |
RBI REF RATE (05/02) |
|
USDINR |
83.02 |
|
EURINR |
89.52 |
|
GBPINR |
104.73 |
|
JPYINR |
55.98 |
In Feb, FPI’S have bought Rs 312 Cr of Equities and bought Rs 2267 Cr of debt . In last calendar year, FII’S have net bought Rs 172853 Cr of Equities and have net bought Rs 70489 Cr of debt.
Benchmark Nifty declined 82 points (0.38%) y’day. US S&P declined 15 points (0.32%) y’day. Nikkei climbed 0.63% and Hang Seng declined 0.15% y’day.
Euro is now at 1.0749, Pound at 1.2549, Yen at 148.55.
Commodities: Gold is now at USD 2026 and WT1Crude at USD 72.75/Brent at USD 78.
Interest rates: USD 10 Yr yield is at 4.14% and 3 m libor closed at 5.59%. Indian 10 yr benchmark yield closed at 7.09%.
Economic news: OECD upgraded Global economic growth to 2.9% from 2.7% for 2024. Despite some moderation in growth and the ongoing adjustments to tighter financial conditions, OECD cautions that it is “too soon to be sure that underlying price pressures are fully contained.” Labor markets showing signs of equilibrium bring a positive note, yet the persistently high unit labor cost growth looms as a challenge for meeting medium-term inflation targets.
The specter of high geopolitical tension, particularly in the Middle East, poses a “significant near-term risk to activity and inflation”, with potential disruptions in energy markets likely to have far-reaching consequences.
USD rally continued against majors. Fed Chair Jerome Powell emphasized the importance of ensuring inflation is convincingly on a downward trajectory toward 2% target before the central bank cut interest rates. He candidly stated, “it’s not likely that this committee will reach that level of confidence in time for the March meeting,” echoing the comments he made last week at the post-FOMC press conference.
Data highlights: – US ISM(services) climbed to 53.4.
-EU PMI(services) was reported at 48.4, sentix investor confidence survey improved to -12.9 and PPI declined -0.8% m/m.
-UK PMI(services) climbed to 54.3.
Tuesday’s calendar : – German factory orders and EU retail sales
-UK PMI(construction)
|
USD/INR |
|
83.08 |
83 |
|
|
EUR/USD |
1.0749 |
1.0787 |
1.0723 |
|
|
GBP/USD |
1.2549 |
1.2644 |
1.2517 |
|
|
USD/JPY |
148.55 |
148.91 |
148.26 |
Daily Support/Resistance table
|
Currency Pairs |
Pivot |
R1 |
R2 |
R3 |
S1 |
S2 |
S3 |
|
EURO/USD |
1.0750 |
1.0777 |
1.0814 |
1.0842 |
1.0713 |
1.0686 |
1.0649 |
|
GBP/USD |
1.2564 |
1.2611 |
1.2691 |
1.2737 |
1.2484 |
1.2437 |
1.2358 |
|
USD/JPY |
148.62 |
148.98 |
149.27 |
149.62 |
148.33 |
147.97 |
147.68 |
|
USD/INR |
83.04 |
83.08 |
83.12 |
|
83 |
82.96 |
|
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
|
Currency Pair |
Supports |
Resistances |
Trend |
Remarks |
|
EURO/USD |
1.0770/1.0725 |
1.09 |
SIDE |
UP>1.09 |
|
GBP/USD |
1.2560/1.2480 |
1.28 |
SIDE |
UP>1.28 |
|
USD/JPY |
146/144.35 |
148.90/150 |
UP |
SIDE<145.90 |
|
USD/INR |
82.80 |
83.18/83.24 |
SIDE |
UP>83.35 |
|
USD/CHF |
0.8550 |
0.8850 |
SIDE |
DN>0.8550 |
Technicals: Spot closed below 20 and 50 day average but above 200 day moving averages.20 day moving average is at 83.08. 50 day moving average is at 83.20.200 day moving average is at 82.78. Daily MACD is in sell zone. Important support is at 82.80 and important resistance is at 83.17/83.24. Spot closed at the average level of the day.
Intraday supports and resistances for Feb contract are:
PP: 83.12, S1:83.01, S2:82.91, R1:83.22, R2:83.33.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USD exports be hedged at 83.35/83.40. Imports be hedged at 82.92/82.80 for 3 months.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is between major moving averages. Major resistance is at 1.09/1.10. Next major support is at 1.0770/1.0725. Daily MACD is in sell zone, implying an important top at 1.1275. Weekly MACD is in buy zone, implying important bottom at 1.0450.
GBP/USD: The pair is between major moving averages. Daily MACD is in sell zone, implying important top at 1.2810 and weekly MACD is in buy zone, implying important bottom at 1.25. Important support is at 1.2550/1.2480. Important resistance is at 1.28/1.30.
USD/YEN: The pair is above all major moving averages. Daily MACD is in buy zone, implying important bottom at 145.90. Important resistance is at 148.90/150 and support is at 145.90/144.35.