FX – MORNING UPDATE :
FX Morning Update USD INR July 15, 2024
USDINR opened at 83.53 on Friday and the pair traded in the 83.49-83.57 range. Spot USDINR closed at 83.52, loss of 7 ps for USD as against prior close of 83.59.
RBI reference rate was fixed at 83.54 on 12/07. July USD/INR closed at 83.55, loss of 7 ps for USD as compared to prior day’s close of 83.62. July Euro/INR closed at 90.98, GBP/INR at 108.07 and Yen/INR at 52.40. 1 year USDINR fwd premia was trading at around 1.64% p.a. FX reserves stood at USD 657 bn, as on July 5 th. Reserves climbed by US D 5 bn w/w.
|
PAIRS |
RBI REF RATE (12/07) |
|
USDINR |
83.54 |
|
EURINR |
90.79 |
|
GBPINR |
107.83 |
|
JPYINR |
52.49 |
In July , FPI’S have bought Rs 13799 Cr of Equities and bought Rs 6277 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 186 points (0.77%) on Friday. US S&P climbed 30 points (0.62%). Nikkei declined 2.46% and Hang Seng climbed 2.59% on Friday.
Euro is now at 1.0907, Pound at 1.2995, Yen at 157.90.
Commodities: Gold is now at USD 2411 and WT1Crude at USD 82.20/Brent at USD 85.25.
Interest rates: USD 10 Yr yield is at 4.18% and 3 m libor closed at 5.57%. Indian 10 yr benchmark yield closed at 6.98%.
Economic news: Indian CPI climbed to 4 month high of 5.08%. Food inflation climbed to 9.55% as against 8.58% in May. Vegetable prices climbed 29.3% and pulses inflation accelerated 16.1%. IIP climbed 5.9% in May. Mfrg climbed 4.6%, mining grew by 6.6% and power sector climbed 13.7%. Consumer durables grew by 12.3% and Capital sector climbed 2.5%.
USD declined despite stronger than expected PPI data. Highlight of last week was the softer than expected US CPI data. This could aid Fed to cut rates in Sept and possibly cut again in Dec. Probability of Sept rate cut has soared to 80%. Lower than expected consumer sentiment and softer inflation expectations were enough to maintain selling pressure on the US Dollar heading into the weekend.
In Currency markets, yen was a major gainer due to possible intervention by BOJ. Gold also rallied. US Equity markets gyrated after US CPI data. Tech stocks fell steeply on Thursday.
Indian Equity markets continued to rally. TCS beat expectations. Focus will be on quarterly results and Union budget. FX reserves climbed steeply as RBI absorbed FPI inflows.
ECB meeting, US retail sales and Fed Chairman’s speech are important events for coming week.
Data highlights: – – US PPI climbed 0.2% m/m and Core PPI climbed 0.4% m/m.
Monday’s calendar : -EU industrial production
|
USD/INR |
|
83.57 |
83.49 |
|
|
EUR/USD |
1.0907 |
1.0912 |
1.0861 |
|
|
GBP/USD |
1.2995 |
1.2995 |
1.2902 |
|
|
USD/JPY |
157.90 |
159.45 |
157.38 |
Daily Support/Resistance table
|
Currency Pairs |
Pivot |
R1 |
R2 |
R3 |
S1 |
S2 |
S3 |
|
EURO/USD |
1.0893 |
1.0925 |
1.0944 |
|
1.0874 |
1.0842 |
|
|
USD/JPY |
158.24 |
159.10 |
160.31 |
|
157.03 |
156.17 |
|
|
GBP/USD |
1.2964 |
1.3026 |
1.3057 |
|
1.2933 |
1.2871 |
|
|
USD/INR |
83.525 |
83.56 |
83.595 |
|
83.49 |
83.45 |
|
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
|
Currency Pair |
Supports |
Resistances |
Trend |
Remarks |
|
EURO/USD |
1.0845/1.08/1.0760 |
1.0915 |
UP |
DN<1.0760 |
|
GBP/USD |
1.2865/1.2735 |
1.3150 |
UP |
DN<1.2615 |
|
USD/JPY |
157.50/154.50 |
162 |
UP |
SIDE<157.50 |
|
USD/INR |
83.34 |
83.70 |
UP |
SIDE<83.30 |
|
USD/CHF |
0.8825/0.8730 |
0.9050 |
DN |
UP>0.9050 |
Technicals: Spot closed above 50 and 200 day moving averages.20 day moving average is at 83.49. 50 day moving average is at 83.46. 200 day moving average is at 83.24. Daily MACD is in buy zone. Important support is at 83.34 and important resistance is at 83.70. Spot closed below the average level of the day.
Intraday supports and resistances for July contract are:
PP: 83.55, S1:83.51, S2:83.48, R1:83.59, R2:83.62.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USD exports be hedged at 83.60+.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is above major moving averages. Major resistance is at 1.0915 Next major support is at 1.0840/1.08/1.0750. Daily MACD is in buy zone, implying an important bottom at 1.0665. 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 buy zone, implying important bottom at 1.2610 and weekly MACD is in buy zone, implying important bottom at 1.23. Important support is at 1.2865/1.2735. Important resistance is at 1.3150.
USD/YEN: The pair is above major moving averages. Daily MACD is in sell zone, implying important top at 162. Important resistance is at 162 and support is at 157.50/154.75.
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