USDINR opened at 82.11 on Friday and the pair traded in the 82.10-82.23 range. Spot USDINR closed at 82.16, gain of 7 ps for USD as against prior close of 82.09.

RBI reference rate was fixed at 82.16 on 12/05. May USD/INR closed at 82.23, gain of 9 ps for USD as compared to prior day’s close of 82.14. May Euro/INR closed at 89.63, GBP/INR at 102.93 and Yen/INR at 61.13. USDINR fwd premia was trading at around 2.14% p.a.  FX reserves climbed USD 8 bn as compared to prior week and stood at USD 596 bn as on May 5 th. This is the highest since June 2022.

In May till date, FII’S  have bought Rs 16682 Cr of Equities and have bought Rs 352 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 climbed 17 points (0.18%) on Friday. DOW declined 9 points (0.03%) on Friday. Nikkei climbed 0.90% and Hang seng declined 0.59% on Friday.

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 3.46% and 3 m libor closed at 5.33%. Indian 10 yr benchmark yield closed at 7%.

Economic news: India’s retail inflation eased to 4.7% in April, falling within the RBI’S inflation band of 2-6%. In March, inflation declined to 5.66%. Food inflation eased to 3.84% from 4.79% in April. IIP climbed 1.1% in March. Mfrg climbed 0.5%, mining grew by 6.8%. In fiscal 2023, the IIP grew 5.1 per cent in 2022-23, as compared to 11.4 per cent in FY2021-22.

USDINR gained to 82.20 due to outflow of USD 1 bn, triggered by adjustment in MSCI stock allocation. Euro weakened due to technical reasons. Pound fell on weak GDP data.

Data highlights: – UK GDP contracted -0.3% m/m in March, but grew by 0.1% q/q., Industrial and manufacturing production climbed 0.7% m/m respectively.

Monday’s calendar : – EU industrial production.

Daily Support/Resistance table

 MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed below 20, 50,100 day averages but still above 200 day major moving average.20 day moving average is at 81.96. 50 day moving average is at 82.23.200 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 at the average level of the day.

Intraday supports and resistances for May contract are:

PP: 82.21, S1:82.14, S2:82.07, R1:82.29, R2:82.35.             

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

However on directional basis, suggest the following:

USD Exports be hedged at 82.35+ levels.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below 20, 50 but above 100 and 200 day major moving averages. Major resistance is at 1.1075. Next major support is at 1.08/1.0750. 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 1.2350/1.2250. Important resistance is at 1.2675.

USD/YEN: The pair is below   200 day moving average. Daily MACD is in sell zone, implying important top at 137.75. Important resistance is at 137.75 and support is at 133.50/132/130.60.

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