USDINR opened at 82.73 y’day and the pair traded in the 82.60-82.80 range. Spot USDINR closed at 82.73, gain of 13 ps for USD as against prior close of 82.60.

RBI reference rate was fixed at 82.68 on 16/03. Mar USD/INR closed at 82.85, loss of 3 ps for USD as compared to prior day’s close of 82.88. Mar Euro/INR closed at 87.98, GBP/INR at 99.85 and Yen/INR at 62.45. USDINR fwd premia was trading at around 2.35% p.a.  FX reserves stands at USD 562.4 bn as on March 3 rd.

In March, FII’S  have bought Rs 18635 Cr of Equities and have sold Rs 1798 Cr of debt . In last Calendar Year, FII’S sold close to Rs 1.06 lac Cr worth of Equities.

Benchmark Nifty climbed 13 points (0.65%) y’day. DOW climbed 372 points (1.17%) y’day. Nikkei declined 0.80% and Hang Seng  declined 1.72% y’day.

Euro is now at 1.0642, Pound at 1.2144, Yen at 133.13.

Commodities: Gold is now at USD 1932 and WT1Crude at USD 69/Brent at USD 75.50.

Interest rates: USD 10 Yr yield is at 3.56% and 3 m libor closed at 5.13%. Indian 10 yr benchmark yield closed at 7.33%.

Economic news: ECB raised rates by 50 bps to 3.5%. However, the statement did not mention about future rate movements. Instead the governing council will continue with a “data-dependent approach”, with decisions determined by inflation outlook, dynamics of underlying inflation, and strength of monetary policy transmission. EU GDP is expected to be 1% in 2023, 1.6% in 2024. Inflation is expected to be 5.3% in 2023 and drop to 2.9% in 2024.

Due to banking crisis, Fed is likely to raise rate only by 25 bps in March meeting and probably make it as a terminal rate, notwithstanding their likely hawkish communication.

Data highlights: – US Weekly jobless claims declined to 192k, building permits climbed to 1.52 mn and housing starts climbed to 1.45 mn.

Friday’s calendar : – US industrial production

-EU CPI

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed below 20, 50 and 100 day major moving averages.20 day moving average is at 82.49. 50 day moving average is at 82.21.200 day moving average is at 80.76. Daily MACD is in buy zone. Important support is at 82.30/82.16 and important resistance is at 82.82/82.95. Spot closed above the average level of the day.

Intraday supports and resistances for March contract are:

PP: 82.79, S1:82.71, S2:82.57, R1:82.93, R2:83.01.             

Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.

However on directional basis, suggest the following:

USD IMPORTS be hedged.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is above 100 and 200 day major moving averages, but below 20 and 50 moving averages. Major resistance is at 1.07. Next major support is at 1.0535. Daily MACD is in buy zone, implying an important bottom at 1.0535. Weekly MACD is in sell zone, implying important top at 1.1035.

GBP/USD: The pair is above 100 and 200 day moving averages , but below 20 and 50 day averages. Daily MACD is in buy zone, implying important bottom at 1.1803 and weekly MACD is in sell zone, implying important top at 1.2450. Important support is at 1.1920/1.1803. Important resistance is at 1.2110/1.2270/1.2450.

USD/YEN: The pair is below 100 and 200 day moving averages, but above 50 day average. Daily MACD is in sell zone, implying important top at 137.90. Important resistance is at 137.90 and support is at 132.20.

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