FX – MORNING UPDATE :

USDINR opened at 81.96 y’day and the pair traded in the 81.94-82.12 range. Spot USDINR closed at 82.09, gain of 9 ps for USD as against prior close of 82.

RBI reference rate was fixed at 82.04 on 11/05. May USD/INR closed at 82.14, gain of 5 ps for USD as compared to prior day’s close of 82.09. May Euro/INR closed at 89.85, GBP/INR at 103.47 and Yen/INR at 61.37. USDINR fwd premia was trading at around 2.20% p.a.  FX reserves climbed USD 4 bn as compared to prior week and stood at USD 588 bn as on Apr 28 th.

PAIRSRBI REF RATE (11/05)
USDINR82.04
EURINR89.95
GBPINR103.50
JPYINR61.12

In May till date, FII’S  have bought Rs 4381 Cr of Equities and have sold Rs 2176 Cr of debt . In 2022-23 fiscal year, FII’S have net sold Rs 27593 Cr of Equities and have net bought Rs 838 Cr of debt.

Benchmark Nifty declined 18 points (0.10%) y’day. DOW declined 30 points (0.09%) y’day. Nikkei climbed 0.02% and Hang seng declined 0.09% y’day.

Euro is now at 1.0922, Pound at 1.2515, Yen at 134.61.

Commodities: Gold is now at USD 2015 and WT1Crude at USD 70/Brent at USD 74.

Interest rates: USD 10 Yr yield is at 3.38% and 3 m libor closed at 5.33%. Indian 10 yr benchmark yield closed at 7.02%.

Economic news: BOE hiked rate by 25 bps in 7-2 vote and left door open for more rate hikes if inflationary pressures persists. BoE expects inflation to “fall sharply from April” and decline to “a little above 1% at the two and three-year horizons”. That would be “materially below the 2% target then.

Crude prices fell further on weak economic signals from China and labor market slow down in US. Stalemate in debt ceiling increase in US also weighed on economic outlook.

Indian CPI and IIP data awaited.

Data highlights: – US Weekly jobless claims climbed to 264k  and PPI climbed 0.2% m/m.

Friday’s calendar : – UK GDP, Industrial and manufacturing production.

USD/INR  82.1281.94
EUR/USD1.09221.09991.0899
GBP/USD1.25151.26421.2496
USD/JPY134.61134.85133.74

Daily Support/Resistance table

Currency PairsPivotR1R2R3S1S2S3
EURO/USD1.09371.09751.10361.10741.08751.08381.0776
GBP/USD1.25491.26021.26941.27471.24561.24041.2311
USD/JPY134.38135.02135.49136.13133.91133.27132.80
USD/INR82.0582.1682.23 81.9881.87 

 MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Currency PairSupportsResistancesTrendRemarks
EURO/USD1.0940/1.08401.1075UPSIDE<1.0940
GBP/USD1.2510/1.23451.2675UPDN<1.2345
USD/JPY133.50/132/130.60135/138SIDEDN<133.50
USD/INR81.62/81.4582.24/82.40DNUP>82.23
USD/CHF0.87550.90/0.9120DNSIDE>0.90

Technicals: Spot closed below 20, 50,100 day averages but still above 200 day major moving average.20 day moving average is at 81.95. 50 day moving average is at 82.21.200 day moving average is at 81.49. Daily MACD is in buy zone. Important support is at 81.62/81.45 and important resistance is at 82.24/82.40. Spot closed above the average level of the day.

Intraday supports and resistances for May contract are:

PP: 82.10, S1:82.02, S2:81.91, R1:82.21, R2:82.29.             

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

However on directional basis, suggest the following:

USD Exports be hedged at 82.20+ levels.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is above 50, 100 and 200 day major moving averages. Major resistance is at 1.1075. Next major support is at 1.0940/1.0840. Daily MACD is in sell zone, implying an important top at 1.1075. Weekly MACD is in buy zone, implying important bottom at 1.0515.

GBP/USD: The pair is above 50,100 and 200 day moving averages . Daily MACD is in buy zone, implying important bottom at 1.2345 and weekly MACD is in buy zone, implying important bottom at 1.1803. Important support is at 1.2510/1.2345. Important resistance is at 1.2670.

USD/YEN: The pair is below   200 day moving average. Daily MACD is in buy zone, implying important bottom at 129.65. Important resistance is at 135/138 and support is at 133.50/132/130.60.

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