USDINR opened higher at 71.78 y’day and the pair traded in the 71.65-72.09 range. Spot USDINR closed at 72.08 y’day, gain of 61 ps for USD as against prior close of 71.47. RBI reference rate was fixed at 71.44 on Monday. Nov USD/INR closed at 72.18, gain of 62 ps for USD as compared to prior day’s close of 71.56. Nov Euro/INR closed at 79.55, GBP/INR at 92.24 and Yen/INR at 66.25.
Rupee decline continued due to poor IIP data, paring of sell positions by USD sellers, stronger USD against majors and fears of entrenched GDP slow down. Moody’s action in changing outlook to negative from stable and continued USD buying by RBI at lower levels are also contributory factors to Rupee weakness. However, overall inflows is good and CNY is steady against USD. Rupee seems to have broken coorrelation with CNY.
FII’S nett bought Rs 4444 Cr of Indian Equities in Oct . FII’S have nett bought Rs 64694 Cr of Indian Equities in this calendar Year till date. FII’S have nett bought Rs 4617 Cr of Indian debt securities in Oct. FII’S have nett bought Rs 47775 Cr of Indian debt in this calendar year till date.
Benchmark Nifty closed flat on Monday. DOW climbed 92 points (0.33%) y’day. Nikkei declined 0.61% and Hang seng declined 1.82% y’day.
Euro is now at 1.1003 ,Pound at 1.2842,Yen at 108.72.
Commodities: Gold is now at USD 1464 and WT1Crude at USD 57.43./Brent at USD 62.63.
Interest rates: USD 10 Yr yield is at 1.87% and 3 m libor closed at 1.93%. Indian 10 yr benchmark yield closed at 6.53%.
Economic news: Indian CPI breached RBI’S comfort zone of 4% and climbed to 4.62%, due to higher food inflation. Food inflation climbed to 7.89% vs 5.1% in Sept. Core inflation moderated to 3.5% from 4%. Vegetable prices climbed 26% m/m.
Data highlights : – US CPI climbed 0.4% m/m, higher than expected.
-EU Industrial production climbed 0.1% m/m.
-UK CPI climbed 1.5% y/y, RPI climbed 2.1% y/y and PPI(output) declined -0.1% m/m.
Thursday’s calendar: – US PPI and weekly jobless claims
-EU flash GDP.
-UK retail sales
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 100 and 200 day moving average. 20 day moving average is at 71.10. 50 day moving average is at 71.22.200 day moving average is at 70.28. Daily MACD is in buy zone, implying bottom at 70.55. Important support is at 71.75 and next important resistance is at 72.45. Spot closed above its average level of the day.
Intra day supports and resistances for Nov contract are:
PP: 72.01,S1:71.88, S2:71.60, R1:72.30, R2:72.42
Hedging strategy for USD/INR: Hedging decisions be taken according to comfort and accounting rates.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below major moving averages. Next Major resistance is at 1.1180. Major support is at 1.10 and later at 1.0870. Daily MACD is in sell zone, implying an important topo at 1.1185. Weekly MACD is in buy zone, implying important bottom at 1.0870.
GBP/USD: The pair is sideways but is still trading above 200 day moving average.Daily MACD is in sell zone, implying important top at 1.30 and weekly MACD is in buy zone, implying important bottom at 1.20. Important resistance is at 1.30/1.31. Important support is at 1.2705 and later at 1.2550.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 107.85. Next important resistance is at 110.65. Important support is at 107.85/106.50.