FX – MORNING UPDATE :
FX Morning Update USD INR April 12, 2024
USDINR opened at 83.21 on Wednesday and the pair traded in the 83.16-83.24 range. Spot USDINR closed at 83.21, loss of 9 ps for USD as against prior close of 83.30. FX market was closed y’day.
Thank you for reading this post, don't forget to subscribe!RBI reference rate was fixed at 83.22 on 10/04. Apr USD/INR closed at 83.22, loss of 13 ps for USD as compared to prior day’s close of 83.35. Euro/INR closed at 90.28, GBP/INR at 105.65 and Yen/INR at 54.98. 1 year USDINR fwd premia was trading at around 1.62% p.a. FX reserves stood at USD 645.58 bn, as on March 29 th.
|
PAIRS |
RBI REF RATE (10/04) |
|
USDINR |
83.22 |
|
EURINR |
90.29 |
|
GBPINR |
105.52 |
|
JPYINR |
54.83 |
In April, FPI’S sold Rs 2680 Cr of Equities and sold Rs 3508 Cr of debt . In FY 23-24, FII’S have net bought Rs 206279 Cr of Equities and have net bought Rs 123120 Cr of debt.
Benchmark Nifty climbed 111 points (0.49%) on Wednesday. US S&P climbed 38 points (0.74%) y’day. Nikkei declined 0.30% and Hang Seng declined 0.26% y’day.
Euro is now at 1.0726, Pound at 1.2557, Yen at 153.
Commodities: Gold is now at USD 2384 and WT1Crude at USD 85.45/Brent at USD 90.
Interest rates: USD 10 Yr yield is at 4.57% and 3 m libor closed at 5.59%. Indian 10 yr benchmark yield closed at 7.11%.
Economic news: US Yields rose and spurred Dollar rally against EU majors after release of stronger than expected CPI data. Also, ECB’S rate cut comments triggered Euro decline to 1.07.
US CPI rose 0.4% mom in March, above expectation of 0.3% mom. CPI core (all items less food and energy) rises 0.4% mom, also above expectation of 0.3% mom. Energy index rose 1.1% mom. Food index rose 0.1% mom.For the 12 months period, CPI accelerated from 3.2% yoy to 3.5% yoy, above expectation of 3.4% yoy. CPI core was unchanged at 3.8% yoy, above expectation of 3.7% yoy.
New York Fed President John Williams suggested that, should the economy evolve as anticipated, it would be prudent to “dial back the policy restraint gradually over time, starting this year.” However, he was quick to stress the inherent uncertainty in the economic outlook, underscoring the need for Fed to maintain a data-dependent approach.
FOMC minutes also highlighted members dilemma over slow speed in inflation declining trend. FOMC members voted to keep language in the post-meeting statement that they wouldn’t be cutting rates until they “gained greater confidence” that inflation was on a steady path back to the central bank’s 2% annual target.“Participants generally noted their uncertainty about the persistence of high inflation and expressed the view that recent data had not increased their confidence that inflation was moving sustainably down to 2 percent,” the minutes said.
ECB maintained its interest rates as widely expected, holding main refinancing rate and deposit rate at 4.50% and 4.00%. Most importantly, for the first time, the central bank explicitly indicated the possibility for future interest rate cuts, which would be seen as a conditional guidance for a June adjustment. “If the Governing Council’s updated assessment of the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission were to further increase its confidence that inflation is converging to the target in a sustained manner, it would be appropriate to reduce the current level of monetary policy restriction,” ECB said. Nevertheless, the decision will still be data depended, and meeting-by meeting.
Data highlights: — US CPI and Core CPI climbed 0.4% m/m, PPI and Core PPI climbed 0.2% m/m.
-US Weekly jobless claims dipped to 211k.
Friday’s calendar : UK industrial and manufacturing production.
-UK GDP
|
USD/INR |
|
83.24 |
83.16 |
|
|
EUR/USD |
1.0726 |
1.0757 |
1.0699 |
|
|
GBP/USD |
1.2557 |
1.2578 |
1.2510 |
|
|
USD/JPY |
153 |
153.32 |
152.75 |
Daily Support/Resistance table
|
Currency Pairs |
Pivot |
R1 |
R2 |
R3 |
S1 |
S2 |
S3 |
|
EURO/USD |
1.0727 |
1.0755 |
1.0785 |
1.0813 |
1.0697 |
1.0669 |
1.0639 |
|
GBP/USD |
1.2548 |
1.2586 |
1.2616 |
1.2654 |
1.2518 |
1.2480 |
1.2450 |
|
USD/JPY |
153.09 |
153.43 |
153.66 |
154 |
152.86 |
152.52 |
152.29 |
|
USD/INR |
83.20 |
83.24 |
83.28 |
|
83.165 |
83.12 |
|
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
|
Currency Pair |
Supports |
Resistances |
Trend |
Remarks |
|
EURO/USD |
1.0655 |
1.0885 |
DN |
UP>1.0885 |
|
GBP/USD |
1.25/1.2380 |
1.2711/1.28 |
DN |
UP>1.2685 |
|
USD/JPY |
152/150.80 |
154.50 |
UP |
SIDE<150.80 |
|
USD/INR |
83.17/83.05 |
83.47/83.70/84.10 |
UP |
SIDE<83. |
|
USD/CHF |
0.90 |
0.9230 |
UP |
SIDE<0.90 |
Technicals: Spot closed above major moving averages.20 day moving average is at 83.145. 50 day moving average is at 83.045. 200 day moving average is at 82.91. Daily MACD is in buy zone. Important support is at 83.17 and important resistance is at 83.47/83.70. Spot closed above the average level of the day.
Intraday supports and resistances for April contract are:
PP: 83.23, S1:83.18, S2:83.14, R1:83.27, R2:83.32.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USD imports be hedged on decline to 83.20/83.05.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below major moving averages. Major resistance is at 1.0885/1.10. Next major support is at 1.0655. Daily MACD is in sell zone, implying an important top at 1.0885. Weekly MACD is in sell zone, implying important top at 1.1140.
GBP/USD: The pair is below major moving averages. Daily MACD is in sell zone, implying important top at 1.2710 and weekly MACD is in sell zone, implying important top at 1.2895. Important support is at 1.2510/1.2380. Important resistance is at 1.2710/1.28.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 150.80. Important resistance is at 154.50 and support is at 152/150.80.
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