USDINR opened at 77.64 Y’day and the pair traded in the 77.62-77.70 range. Spot USDINR closed at 77.63, gain of 9 ps for USD as against prior close of 77.54. RBI reference rate was fixed at 77.66 on 31/05. June USD/INR closed at 77.89, gain of 13 ps for USD as compared to prior day’s close of 77.76. June Euro/INR closed at 83.45, GBP/INR at 98.06 and Yen/INR at 60.87. USDINR fwd premia was trading at around 3.80% p.a. FX reserves stands at USD 597.73 bn as on 22/5.
|PAIRS||RBI REF RATE (31/05)|
In 2022-23 fiscal, FII’S have sold 39538 Cr of Equities till date and have sold Rs 6787 Cr of debt till date. In 2021-22, FII’S net sold Rs 128897 cr in Equity segment and have net bought Rs 4805 cr of 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 76 points (0.46%) y’day. DOW declined 222 points. (0.67%).Nikkei declined 0.33% and Hang Seng climbed 1.38%.
Euro is now at 1.0727, Pound at 1.2606, Yen at 128.97.
Commodities: Gold is now at USD 1837 and WT1Crude at USD 115.50/Brent at USD 116.50.
Interest rates: USD 10 Yr yield is at 2.87% and 3 m libor closed at 1.57%. Indian 10 yr benchmark yield closed at 7.45%.
Economic news: Indian GDP climbed 8.7% in 2021-22 as against contraction of 6.6% in 2020-21. In Q4, GDP climbed 4.1% y/y. Agri sector grew by 4.1%, manufacturing contracted 0.2%, mining grew 6.7% and construction sector grew by 2%. Trade, hotel, transport, communication grows 5.3% in Q4 as compared to 6.3% in preceding quarter
Financial services sector grows at 4.3% as compared to 4.2% in third quarter. Pvt final consumption expenditure grew by 1.77% and Govt consumption expenditure grew by 4.8%.
GDP growth for Q4 FY22 at 4.1 per cent reflects the impact of the Omicron wave, higher input costs and a high base in certain sectors from last year. Gross fixed capital formation was estimated at Rs 47.84 trillion in 2021-22, up from Rs 41.31 trillion in the preceding year. It grew by 5.1% in Q4.
Eight core sectors grew by 8.4% in April.
Govt of India cleared GST compensation to states till May, by releasing Rs 86912 Cr. Fiscal deficit stood at 6.71% in 2021-22 as against BE of 6.9%.
Eurozone CPI accelerated further from 7.4% yoy to 8.1% yoy in May, another record and above expectation of 7.7% yoy. CPI core also rose from 3.5% yoy to 3.8% yoy, above expectation of 3.5% yoy.
Data highlights: – : US house price index climbed 21.2% y/y.
-EU CPI(flash) climbed 8.1% y/y.
Wednesday’s calendar : US ISM(mfrg), construction spending
-German retail sales, PMI(mfrg) and unemployment rate
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 200 day major moving averages.20 day moving average is at 77.31. 50 day moving average is at 76.62.200 day moving average is at 75.14. Daily MACD is in sell zone, implying top at 77.78. Important supports are at 77.48/77.27/77.15 and important resistance is at 77.80/78. Spot closed below its average level of the day.
Intraday supports and resistances for June contract are:
PP: 77.87, S1:77.82, S2:77.75, R1:77.94, R2:77.99.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USDINR Exports can be partially hedged at 77.65+ levels.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below major moving averages. Major resistance is at 1.0750/1.0940. Next major support is at 1.0350. Daily MACD is in buy zone, implying an important bottom at 1.0350. Weekly MACD is in sell zone, implying important top at 1.1498.
GBP/USD: The pair is below 50 and 200 day moving averages. Daily MACD is in buy zone, implying important bottom at 1.2165 and weekly MACD is in sell zone, implying important top at 1.3730. Important support is at 1.2500/1.2325/1.2165. Important resistance is at 1.28.
USD/YEN: The pair is above major moving averages. Daily MACD is in sell zone, implying important top at 131.30. Important support is at 126.40/125.
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