FX – MORNING UPDATE :
FX Morning Update USD INR August 06, 2024
USDINR opened at 83.76 y;’day and the pair traded in the 83.76-84.10 range. Spot USDINR closed at 84.10, gain of 35 ps for USD as against prior close of 83.75
RBI reference rate was fixed at 83.74 on 02/08. Aug USD/INR closed at 84.18, gain of 37 ps for USD as compared to prior day’s close of 83.81. Aug Euro/INR closed at 92.10, GBP/INR at 107.18 and Yen/INR at 59.10. 1 year USDINR fwd premia was trading at around 2% p.a. FX reserves stood at USD 667 bn, as on July 26 th. Reserves declined by US D 3.5 bn w/w.
|
PAIRS |
RBI REF RATE (05/08) |
|
USDINR |
83.84 |
|
EURINR |
91.44 |
|
GBPINR |
106.71 |
|
JPYINR |
58.82 |
In July , FPI’S have bought Rs 27957 Cr of Equities and bought Rs 21863 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 declined 662 points (2.68%) y’day. US S&P declined 160 points (3%). Nikkei declined 13.5% and Hang Seng declined 1.46% y’day.
Euro is now at 1.0959, Pound at 1.2795, Yen at 145.20.
Commodities: Gold is now at USD 2414 and WT1Crude at USD 74/Brent at USD 77.50.
Interest rates: USD 10 Yr yield is at 3.84% and 3 m libor closed at 5.43%. Indian 10 yr benchmark yield closed at 6.96%.
Economic news: Rupee declined, USD declined against majors, Yields tumbled and stocks crashed. Japanese Nikkei declined 13.5% and Indian indices were down 2.75%. RBI could not stem Rupee fall and allowed it to breach 84. Unwinding of Yen carry trades and fear of US economic slow down pushed investors into pulling out funds from riskier assets. Crude Oil also declined. Yen has gained to 142 from its lows of 162. Recent volatility stems from a combination of weak economic data, geopolitical uncertainties, and central bank actions, compounded by stretched positioning in equity futures.
Eurozone Sentix Investor Confidence fell sharply from -7.3 to -13.8 in August, marking its lowest level since January. Current Situation Index dropped from -15.8 to -19.0, the lowest since February, while Expectations Index declined from 1.5 to -8.8, the lowest since last December.
Globally, Sentix Investor Confidence Index also tumbled, falling from 5.9 to -1.5, its lowest level since December.
Eurozone PMI Services was finalized at 51.9 in July, down from June’s 52.8, a 4-month low. PMI Composite was finalized at 50.2, down from June’s 50.9, a 5-month low. These figures indicate a slowing economy as the services sector loses momentum and the industrial sector continues its decline.
UK PMI Services was finalized at 52.5 in July, up from June’s 52.1. PMI Composite was finalized at 52.8, up from June’s 52.3.
Data highlights: – -US ISM(services) inched to 51.4.
-EU PPI climbed 0.5% m/m, PMI(services-final) was reported at 51.9.
-UK PMI(services-final) inched to 52.5.
Tuesday’s calendar : – German factory orders
-UK PMI(construction)
|
USD/INR |
|
84.10 |
83.76 |
|
|
EUR/USD |
1.0959 |
1.1009 |
1.0892 |
|
|
GBP/USD |
1.2795 |
1.2816 |
1.2710 |
|
|
USD/JPY |
145.20 |
145.95 |
141.69 |
Daily Support/Resistance table
|
Currency Pairs |
Pivot |
R1 |
R2 |
R3 |
S1 |
S2 |
S3 |
|
EURO/USD |
1.0951 |
1.1010 |
1.1068 |
1.1127 |
1.0893 |
1.0834 |
1.0776 |
|
USD/JPY |
144.47 |
147.25 |
148.73 |
151.51 |
142.99 |
140.21 |
138.74 |
|
GBP/USD |
1.2771 |
1.2832 |
1.2877 |
1.2938 |
1.2726 |
1.2665 |
1.2619 |
|
USD/INR |
83.98 |
84.21 |
84.33 |
|
83.86 |
83.63 |
|
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
|
Currency Pair |
Supports |
Resistances |
Trend |
Remarks |
|
EURO/USD |
1.08/1.0760 |
1.1040 |
UP |
DN<1.0760 |
|
GBP/USD |
1.2705/1.2650 |
1.3050/1.3150 |
SIDE |
DN<1.2650 |
|
USD/JPY |
142 |
149/152 |
DN |
SIDE>152 |
|
USD/INR |
83.90/83.76 |
84.10/84.25 |
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 83.67. 50 day moving average is at 83.53. 200 day moving average is at 83.28. Daily MACD is in buy zone. Important support is at 83.56/83.34 and important resistance is at 84.25. Spot closed above the average level of the day.
Intraday supports and resistances for July contract are:
PP: 84.01, S1:83.30, S2:83.41, R1:84.40, R2:84.61.
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 1.1040. Next major support is at 1.0775. Daily MACD is in buy zone, implying an important bottom at 1.0775. 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 1.2705/1.2650. Important resistance is at 1.3050/1.3150.
USD/YEN: The pair is below major averages. Daily MACD is in sell zone, implying important top at 162. Important resistance is at 149/152 and support is at 142.
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