FX – MORNING UPDATE :
FX Morning Update USD INR June 7, 2024
USDINR opened at 83.40 Y’day and the pair traded in the 83.40-83.53 range. Spot USDINR closed at 83.53, gain of 9 ps for USD as against prior close of 83.44.
Thank you for reading this post, don't forget to subscribe!RBI reference rate was fixed at 83.46 on 06/06. June USD/INR closed at 83.53, gain of 9 ps for USD as compared to prior day’s close of 83.44. June Euro/INR closed at 90.85, GBP/INR at 106.66 and Yen/INR at 53.45. 1 year USDINR fwd premia was trading at around 1.60% p.a. FX reserves stood at USD 646.6 bn, as on May 24 th. Reserves declined by USD 3.26 bn w/w.
|
PAIRS |
RBI REF RATE (06/06) |
|
USDINR |
83.46 |
|
EURINR |
90.81 |
|
GBPINR |
106.78 |
|
JPYINR |
53.47 |
In May till date, FPI’S have sold Rs 5433 Cr of Equities and bought Rs 2848 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 201 points (0.89%) Y’day. US S&P closed flat (0%). Nikkei climbed 0.74% and Hang Seng climbed 0.28% y’day.
Euro is now at 1.0895, Pound at 1.2792, Yen at 155.69.
Commodities: Gold is now at USD 2370 and WT1Crude at USD 74.50/Brent at USD 79.
Interest rates: USD 10 Yr yield is at 4.29% and 3 m libor closed at 5.59%. Indian 10 yr benchmark yield closed at 7.02%.
Economic news: ECB lowered interest rates by 25 basis points as widely expected. Following the reduction, the main refinancing rate is now 4.25%, the deposit rate is 3.75%, and the marginal lending rate is 4.50%.
In its latest forecasts, the ECB projects economic growth to pick up to 0.9% in 2024, 1.4% in 2025, and 1.6% in 2026. Inflation is expected to average 2.5% in 2024, 2.2% in 2025, and 1.9% in 2026. Core inflation is forecasted to average 2.8% in 2024, 2.2% in 2025, and 2.0% in 2026.
ECB President Christine Lagarde, speaking at the post-meeting press conference, deliberately avoided providing explicit forward guidance, stating that ECB is not pre-committing to any particular rate path. Lagarde also addressed the current inflation dynamics, acknowledging that price pressures are gradually subsiding, although wage inflation remains a concern. However, forward-looking indicators suggest that wage growth is likely to moderate over the course of the year. She projected that inflation would continue to hover around current levels for the remainder of this year and would begin to approach 2% target in the latter half of 2025.
EUR/USD reaction was muted. Focus is now on US non farm payrolls data.
Data highlights: – US Weekly jobless claims climbed to 229k.
-German factory orders declined -0.2% m/m.
Friday’s calendar : – US Nonfarm payrolls
-German Industrial production.
|
USD/INR |
|
83.53 |
83.40 |
|
|
EUR/USD |
1.0895 |
1.0902 |
1.0862 |
|
|
GBP/USD |
1.2792 |
1.2809 |
1.2763 |
|
|
USD/JPY |
155.69 |
156.44 |
155.38 |
Daily Support/Resistance table
|
Currency Pairs |
Pivot |
R1 |
R2 |
R3 |
S1 |
S2 |
S3 |
|
EURO/USD |
1.0885 |
1.0908 |
1.0925 |
1.0948 |
1.0868 |
1.0845 |
1.0828 |
|
GBP/USD |
1.2788 |
1.2813 |
1.2834 |
1.2860 |
1.2767 |
1.2742 |
1.2720 |
|
USD/JPY |
155.83 |
156.28 |
156.89 |
157.34 |
155.22 |
154.77 |
154.16 |
|
USD/INR |
83.49 |
83.57 |
83.62 |
|
83.45 |
83.36 |
|
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
|
Currency Pair |
Supports |
Resistances |
Trend |
Remarks |
|
EURO/USD |
1.0775/1.0735 |
1.0885 |
UP |
DN<1.0735 |
|
GBP/USD |
1.2635/1.2575/1.2535 |
1.2825 |
UP |
DN<1.2535 |
|
USD/JPY |
153.75/152 |
157.80/160 |
UP |
SIDE<152 |
|
USD/INR |
82.95/82.85 |
83.52/83.70 |
SIDE |
UP>83.55 |
|
USD/CHF |
0.8885 |
0.9150/0.9295 |
UP |
SIDE<0.90 |
Technicals: Spot closed above 50 and 200 day moving averages.20 day moving average is at 83.40. 50 day moving average is at 83.37. 200 day moving average is at 83.13. Daily MACD is in buy zone. Important support is at 83.05/82.95 and important resistance is at 83.52/83.70. Spot closed above the average level of the day.
Intraday supports and resistances for June contract are:
PP: 83.48, S1:83.40, S2:83.27, R1:83.61, R2:83.69.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USD exports be hedged at 83.52.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is above major moving averages. Major resistance is at 1.0885. Next major support is at 1.0775/1.0735. 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 above major moving averages. Daily MACD is in buy zone, implying important bottom at 1.23 and weekly MACD is in sell zone, implying important top at 1.2895. Important support is at 1.2535. Important resistance is at 1.2825.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 152. Important resistance is at 157.80/ 160 and support is at 151.85/149.
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