USDINR opened at 82.98 y’day and the pair traded in the 82.71-83.29 range. Spot USDINR closed at 82.75, loss of 27 ps for USD as against prior close of 83.02.

RBI reference rate was fixed at 83.20 on 20/10. Oct USD/INR closed at 82.78, loss of 36 ps for USD as compared to prior day’s close of 83.14. Oct Euro/INR closed at 81.29, GBP/INR at 92.95 and Yen/INR at 55.37. USDINR fwd premia was trading at around 2.50% p.a.  FX reserves stands at USD 532.87 bn as on Oct 14 th.

In Oct, FII’S have sold Rs 9135 Cr of Equities and have bought Rs 481 Cr of debt till date. In this Calendar Year, FII’S have sold close to Rs 1.55 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 51 points (0.30%) y’day. DOW declined 90 points (-0.30%). Nikkei declined 0.92% and Hang Seng declined 1.40%.

Euro is now at 0.9769, Pound at 1.1205, Yen at 150.20.

Commodities: Gold is now at USD 1630 and WT1Crude at USD 84.50/Brent at USD 92.30.

Interest rates: USD 10 Yr yield is at 4.15% and 3 m libor closed at 4.24%. Indian 10 yr benchmark yield closed at 7.47%.

Economic news: Rupee declined to 83.29 and regained part of its losses as RBI stepped to prevent further intra day decline. On Wednesday, GAIL bought USD 1 bn for its imports requirement.

UK PM Truss stepped down, paving the way for a new PM by next week. UK’S economic mess may linger, even if a new PM is in place shortly. Pound and stock markets did not react much to this development.

St. Louis Fed President James Bullard said yesterday that Fed’s goal is to front-load aggressive rate hikes to move to “some meaningfully restrictive level” that would push inflation down. For November meeting, Bullard said the results “has been more or less priced in to markets” for a 75 basis-point hike. Chicago Fed President Charles Evans said yesterday, “inflation is just much too high, and so we need to continue on the path that we’ve been indicating. 

US Yield jumped to fresh 14-year highs as investors weighed up fresh remarks from Federal Reserve officials calling for the central bank to remain the course on rate hikes.

Data highlights: – US existing home sales climbed to 4.81 mn and weekly jobless claims dipped to 214k.

Friday’s calendar : – UK retail sales

 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 81.98. 50 day moving average is at 80.60.200 day moving average is at 77.56. Daily MACD is in sell zone. Important support is at 82.67/82.40 and important resistance is at 83.35. Spot closed below its average level of the day.

Intraday supports and resistances for Oct contract are:

PP: 82.90, S1:82.60, S2:82.43, R1:83.07, R2:83.37.             

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

However on directional basis, suggest the following:

USDINR imports be hedged at 82.65/82.40.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below major moving averages. Major resistance is at 1.00. Next major support is at 0.9540. Daily MACD is in sell zone, implying an important top at 1.02. 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 1.0380 and weekly MACD is in sell zone, implying important top at 1.3730. Important support is at 1.0380. Important resistance is at 1.1490/1.18.

USD/YEN: The pair is above 50 and 200 day moving averages. Daily MACD is in buy zone, implying important bottom at 140.40. Important support is at 145.90/140.40. Major resistance is at 151.

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