FX – MORNING UPDATE :
FX Morning Update USD INR July 18, 2024
USDINR opened at 83.59 on Tuesday and the pair traded in the 83.56-83.60 range. Spot USDINR closed at 83.58, loss of 2 ps for USD as against prior close of 83.60. Market was closed y’day.
RBI reference rate was fixed at 83.58 on 16/07. July USD/INR closed at 83.60, loss of 2 ps for USD as compared to prior day’s close of 83.62. July Euro/INR closed at 91.20, GBP/INR at 108.37 and Yen/INR at 52.70. 1 year USDINR fwd premia was trading at around 1.74% 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 (16/07) |
|
USDINR |
83.58 |
|
EURINR |
90.97 |
|
GBPINR |
108.27 |
|
JPYINR |
52.71 |
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 26 points (0.11%) on Tuesday. US S&P declined 78 points (1.4%). Nikkei declined 0.31% and Hang Seng climbed 0.06% y’day.
Euro is now at 1.0933, Pound at 1.30, Yen at 156.25.
Commodities: Gold is now at USD 2464 and WT1Crude at USD 81.75/Brent at USD 85.30.
Interest rates: USD 10 Yr yield is at 4.17% and 3 m libor closed at 5.57%. Indian 10 yr benchmark yield closed at 6.97%.
Economic news: Indian trade deficit widened to USD 20.98 bn in June. Exports climbed 2.6% y/y to USD 35.2 bn and imports rose 5% to USD 56.18 bn. In March quarter, current account was in surplus at USD 5.7 bn, 0.6% of GDP. In Q1, export of Goods and services totaled USD 200 bn.
IMF chief economist stated that Fed can afford to “wait a little bit” before lowering interest rates. He expected that one Fed rate cut is likely this year but refrained from specifying the timing.
Fed Governor noted that despite “a few bumps” earlier in the year, inflation has “continued to trend down” across “all price categories.” She mentioned that supply and demand are “gradually coming into better balance,” with supply bottlenecks easing and demand moderating due to high interest rates and the depletion of households’ excess savings.
Pound surged past 1.30 as UK inflation data has faded BOE rate cut in Aug.
Eurozone CPI was finalized at 2.5% yoy in June, down from May’s 2.6% yoy. CPI core (ex-energy, food, alcohol & tobacco) was finalized at 2.9% yoy, unchanged from prior month’s reading.
Data highlights: – US retail sales was flat m/m.
-US building permits climbed to 1.45 mn, housing starts climbed to 1.35 mn and industrial production climbed 0.6% m/m.
-EU and German Zew surveys were reported at 43.7 and 41.8 respectively.
-UK CPI climbed 2% y/y, RPI climbed 2.9% y/y, PPI(output) declined -0.3% m/m.
Thursday’s calendar : – US Weekly jobless claims
-UK retail sales
-UK unemployment rate and claimant count change.
|
USD/INR |
|
83.605 |
83.56 |
|
|
EUR/USD |
1.0933 |
1.0948 |
1.0895 |
|
|
GBP/USD |
1.30 |
1.3046 |
1.2965 |
|
|
USD/JPY |
156.25 |
158.62 |
156.06 |
Daily Support/Resistance table
|
Currency Pairs |
Pivot |
R1 |
R2 |
R3 |
S1 |
S2 |
S3 |
|
EURO/USD |
1.0927 |
1.0959 |
1.0981 |
1.1013 |
1.0906 |
1.0873 |
1.0852 |
|
USD/JPY |
156.95 |
157.84 |
159.52 |
160.41 |
155.27 |
154.38 |
152.71 |
|
GBP/USD |
1.3006 |
1.3047 |
1.3087 |
1.3128 |
1.2996 |
1.2925 |
1.2885 |
|
USD/INR |
83.58 |
83.60 |
83.63 |
|
83.55 |
83.53 |
|
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
|
Currency Pair |
Supports |
Resistances |
Trend |
Remarks |
|
EURO/USD |
1.0845/1.08/1.0760 |
1.1040 |
UP |
DN<1.0760 |
|
GBP/USD |
1.2865/1.2735 |
1.3150 |
UP |
DN<1.2615 |
|
USD/JPY |
155.90/154.50 |
162 |
SIDE |
UP>158.40 |
|
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 83.51. 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 at the average level of the day.
Intraday supports and resistances for July contract are:
PP: 83.61, S1:83.585, S2:83.57, R1:83.62, R2:83.64.
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 1.1040 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 158.40/162 and support is at 155.90/154.75.
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