FX – MORNING UPDATE :
FX Morning Update August 01, 2024
USDINR opened at 83.70 y’day and the pair traded in the 83.69-83.75 range. Spot USDINR closed at 83.70, loss of 2 ps for USD as against prior close of 83.72.
RBI reference rate was fixed at 83.74 on 31/07. Aug USD/INR closed at 83.78, loss of 1 ps for USD as compared to prior day’s close of 83.79. Aug Euro/INR closed at 90.89, GBP/INR at 107.60 and Yen/INR at 55.90. 1 year USDINR fwd premia was trading at around 1.84% p.a. FX reserves stood at USD 670.85 bn, as on July 12 th. Reserves climbed by US D 4.2 bn w/w.
|
PAIRS |
RBI REF RATE (31/07) |
|
USDINR |
83.74 |
|
EURINR |
90.62 |
|
GBPINR |
107.54 |
|
JPYINR |
54.78 |
In July , FPI’S have bought Rs 30824 Cr of Equities and bought Rs 15824 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 94 points (0.38%) y’day. US S&P climbed 85 points (1.58%). Nikkei climbed 1.59% and Hang Seng climbed 2.01% y’day.
Euro is now at 1.0830, Pound at 1.2856, Yen at 149.12.
Commodities: Gold is now at USD 2450 and WT1Crude at USD 78.50/Brent at USD 81.50.
Interest rates: USD 10 Yr yield is at 4.05% and 3 m libor closed at 5.51%. Indian 10 yr benchmark yield closed at 7.04%.
Economic news: Fed kept interest rates unchanged at 5.25-5.50%, as widely anticipated, with a unanimous vote. The accompanying statement closely mirrored June’s guidance for future decisions, maintaining that the Fed is “prepared to adjust the stance of monetary policy as appropriate.”
Fed emphasized that its assessments will consider a “wide range of information,” indicating that it is keeping its plans for potential rate cuts close to the chest for now.
On the economic front, Fed acknowledged that job gains have “moderated” and the unemployment rate has “moved up.” Additionally, the statement noted “some further progress” in reducing inflation towards the target. Fed also mentioned that risks to inflation and employment are continuing to “move into better balance.”
BoJ raised the uncollateralized overnight call rate from 0-0.10% to around 0.25%. BoJ stated that economic activity and prices have been “developing generally in line with the Bank’s outlook.” Moves to raise wages have been spreading, and the annual rate of import price growth has “turned positive again,” with upside risks to prices requiring attention.It also noted if the outlook presented in the July Outlook Report is realized, BoJ will continue to raise the policy interest rate and adjust the degree of monetary accommodation accordingly.
Data highlights: – US ADP employment report, pending home sales
-EU CPI climbed 2.6% y/y and Core CPI climbed 2.9% y/y.
Thursday’s calendar : – US weekly jobless claims, ISM(mfrg)
-US Construction spending
-EU PMI
-UK PMI
|
USD/INR |
|
83.75 |
83.69 |
|
|
EUR/USD |
1.0830 |
1.0850 |
1.0802 |
|
|
GBP/USD |
1.2856 |
1.2865 |
1.2820 |
|
|
USD/JPY |
149.12 |
153.89 |
149.62 |
Daily Support/Resistance table
|
Currency Pairs |
Pivot |
R1 |
R2 |
R3 |
S1 |
S2 |
S3 |
|
EURO/USD |
1.0825 |
1.0848 |
1.0873 |
1.0896 |
1.08 |
1.0777 |
1.0752 |
|
USD/JPY |
151.10 |
152.58 |
155.37 |
156.85 |
148.31 |
146.83 |
144.04 |
|
GBP/USD |
1.2846 |
1.2872 |
1.2891 |
1.2917 |
1.2827 |
1.2801 |
1.2783 |
|
USD/INR |
83.71 |
83.73 |
83.77 |
|
83.67 |
83.65 |
|
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
|
Currency Pair |
Supports |
Resistances |
Trend |
Remarks |
|
EURO/USD |
1.08/1.0760 |
1.0950/1.1040 |
SIDE |
DN<1.08 |
|
GBP/USD |
1.2770/1.2650 |
1.3050/1.3150 |
SIDE |
DN<1.2650 |
|
USD/JPY |
149 |
154 |
DN |
UP>157 |
|
USD/INR |
83.56/83.45/83.34 |
83.90/84.02 |
UP |
SIDE<83.56 |
|
USD/CHF |
0.8730 |
0.9050 |
DN |
UP>0.9050 |
Technicals: Spot closed above 50 and 200 day moving averages.20 day moving average is at 83.62. 50 day moving average is at 83.51. 200 day moving average is at 83.27. Daily MACD is in buy zone. Important support is at 83.56/83.34 and important resistance is at 83.90. Spot closed at the average level of the day.
Intraday supports and resistances for July contract are:
PP: 83.78, S1:83.74, S2:83.72, R1:83.81, R2:83.84.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USD exports be hedged.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is above major moving averages. Major resistance is at 1.0950/1.1040. Next major support is at 1.08/1.0750. Daily MACD is in sell zone, implying an important top at 1.0950. Weekly MACD is in buy zone, implying important bottom at 1.06.
GBP/USD: The pair is above major moving averages. Daily MACD is in sell zone, implying important top at 1.3050 and weekly MACD is in buy zone, implying important bottom at 1.23. Important support is at 1.2770/1.2650. Important resistance is at 1.3050/1.3150.
USD/YEN: The pair is above 200 day major moving average, but below 50 day average. Daily MACD is in sell zone, implying important top at 162. Important resistance is at 155.50/157 and support is at 151.50.
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