USDINR opened at 74.26 and the pair traded in the 74.18-74.36 range. Spot USDINR closed at 74.24, gain of 9 ps USD as against prior close of 74.15. RBI reference rate was fixed at 74.25 on 30/09. Oct USD/INR closed at 74.49, gain of 2 ps for USD as compared to prior day’s close of 74.47. Oct Euro/INR closed at 86.29, GBP/INR at 100.17 and Yen/INR at 66.54. USDINR fwd premia was trading at around 4.40% p.a. FX reserves stands at USD 640 bn.
Rupee lost 1.7% in Sept to close at 74.26 as against Aug close of 73.
|PAIRS||RBI REF RATE (30/09)|
In Sept, FII’S have net bought Rs 8773 cr in Equity segment and have net bought Rs 4548 cr of debt. In this financial year, FII’S have net bought Rs 6398 Cr worth of Indian Equities and have bought Rs 12413 Cr worth of Indian debt. In 2020-21 financial Year, FII’S nett bought Rs 2,74,203 Cr of Equities and have sold Rs 42820 Cr in debt.
Benchmark Nifty declined 0.53% y’day. DOW declined 546 points (1.59%). Nikkei was down 0.31% and Hang seng declined 0.36% y’day.
Euro is now at 1.1564, Pound at 1.3447, Yen at 111.27.
Commodities: Gold is now at USD 1753 and WT1Crude at USD 75/Brent at USD 78.25.
Interest rates: USD 10 Yr yield is at 1.49% and 3 m libor closed at 0.12%. Indian 10 yr benchmark yield closed at 6.21%.
Economic news: Fed Chairman in his testimony to US Congress said that inflation is elevated and will remain so for some more period before moderating. He has now withdrawn word “transitory”. This is considered as mini taper tantrum. Soaring energy prices, steep container freight rates and rising consumption along with supply bottlenecks are likely to keep US inflation elevated. ECB is yet to recognise this problem and ECB Chief maintains that inflation is temporary. US-EU inflation differentials is steep, warranting greater QE tapering by US. US Fed is now behind inflation curve and hence withdraw QE faster than anticipated before, possibly triggering higher USD.
Japanese industrial production dropped -3.2% mom in August, worse than expectation of -0.5% mom. Production in auto dropped -15.2% mom as affected by global semiconductor shortage and factory shutdowns in Southeast Asia.
UK Q2 GDP growth was finalized at 5.5% qoq, revised up from 4.8% qoq. GDP remained -3.3% below the pre-pandemic level at Q4 2019.
Data highlights: – US Weekly jobless claims climbed to 362kand GDP (final) climbed 6.7% q/q, as expected.
-EU unemployment rate declined to 7.5%.
Friday’s calendar: – US Personal income, spending, Core PCE Index
-US ISM(mfrg) and Construction spending
-EU PMI(mfrg), German retail sales, CPI
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 50 and 100,200 day major moving averages.20 day moving average is at 73.62. 50 day moving average is at 73.96.200 day moving average is at 73.57. Daily MACD is in buy zone, implying bottom at 72.92. Important resistance is at 74.50 and important support is at 73.93/73.82/73.74. Spot closed below its average level of the day.
Intraday supports and resistances for Oct contract are:
PP: 74.47 S1:74.39, S2:74.29, R1:74.57, R2:74.65
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USDINR Imports hedging can be done at around 73.85/73.75.
Exporters can hedge EURINR receivables exposure at 86.50.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below 50, 100 and 200 day moving averages. Major resistance is at 1.18/1.1910. Next major support is at 1.1665. Daily MACD is in sell zone, implying an important top at 1.19. Weekly MACD is in sell zone, implying important top at 1.2270.
GBP/USD: The pair is below 50 and 200 day moving averages. Daily MACD is in sell zone, implying important top at 1.39 and weekly MACD is in sell zone, implying important top at 1.4240. Important support is at 1.36.Important resistance is at 1.39.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 109.10. Next important resistance is at 111.60. Important support is at 109.10/108.70.
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