FX MORNING UPDATE

USDINR opened at 79.22 y’day and the pair traded in the 79.20-79.69 range. Spot USDINR closed at 79.63, loss of 11 ps for USD as against prior close of 79.52. 

RBI reference rate was fixed at 79.48 on 11/08Aug USD/INR closed at 79.73, gain of 9 ps for USD as compared to prior day’s close of 79.64. Aug Euro/INR closed at 82.40, GBP/INR at 97.24 and Yen/INR at 60.10. USDINR fwd premia was trading at around 3.02% p.a.  FX reserves stands at USD 573.85 bn as on July 29 th.

PAIRSRBI REF RATE (11/08)
USDINR79.48
EURINR81.84
GBPINR97.03
JPYINR59.78

In Aug till date FII’S have net bought Rs 10977 Cr of Equities in Cash segment and have bought Rs 289 Cr of debt till date. In this Calendar Year, FII’S have sold close to Rs 1.84 lac Cr worth of Equities. 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 climbed 124 points y’day (0.71%) y’day. DOW climbed 27 points (0.08%). Nikkei declined 0.65% and Hang Seng climbed 2.40%.

Euro is now at 1.0311, Pound at 1.2184, Yen at 133.41.

Commodities: Gold is now at USD 1804 and WT1Crude at USD 94/Brent at USD 99.

Interest rates: USD 10 Yr yield is at 2.87% and 3 m libor closed at 2.92%. Indian 10 yr benchmark yield closed at 7.27%.

Economic news: San Francisco Fed President said, “there’s good news on the month-to-month data that consumers and business are getting some relief, but inflation remains far too high and not near our price stability goal,”. She reiterated her view that rise should rise to just under 3.5% by the end of the year. And her baseline for September FOMC meeting is a 50bps hike.

USD declined against Euro as US PPI declined.

Data highlights: – US PPI declined -0.5% m/m and weekly jobless claims rose to 262k.

Friday’s calendar : –UK industrial production, manufacturing production.

USD/INR   79.6979.20
EUR/USD      1.03111.03661.0275
GBP/USD      1.21841.22511.2181
USD/JPY      133.41133.32131.73

Daily Support/Resistance table

Currency PairsPivotR1R2R3S1S2S3
EURO/USD1.03191.03631.04101.04541.02721.02281.0181
GBP/USD1.22151.22491.22851.23191.21791.21451.2109
USD/JPY132.68133.63134.27135.22132.04131.09130.45
USD/INR79.5079.8179.99 79.3179.01 

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Currency PairSupportsResistancesTrendRemarks
EURO/USD1.0125/0.99351.0270/1.0350/1.0450DNSIDE>1.05
GBP/USD1.2040/1.1890/1.17501.2245/1.24DNSIDE>1.2230
USD/JPY130.40135.50/137.50DNSIDE>135.50
USD/INR79.10/78.84/78.5079.80/80.06SIDEUP>79.80
USD/CHF0.94900.9890SIDEDN<0.9490

Technicals: Spot closed above 200 day major moving averages.20 day moving average is at 79.61. 50 day moving average is at 78.93.200 day moving average is at 76.33. Daily MACD is in sell zone. Important supports are at 78.85/78.50 and important resistances are at 79.80/80.06. Spot closed above its average level of the day.

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

However on directional basis, suggest the following:

USDINR Exports can be hedged near 79.70 levels. Nearby imports can be hedged at 78.85/78.50.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below major moving averages. Major resistance is at 1.0270/1.0450. Next major support is at 0.9935. Daily MACD is in buy zone, implying an important bottom at 0.9935. 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 1.1750 and weekly MACD is in sell zone, implying important top at 1.3730. Important support is at 1.2040/1.1890. Important resistance is at 1.2245/1.2450.

USD/YEN: The pair is above 50 and 200 day moving averages. Daily MACD is in sell zone, implying important top at 139.40. Important support is at 130.50. Major resistance is at 139.40 with intermediate resistances at 135.50/137.50.

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