USDINR opened at 82.82 y’day and the pair traded in the 82.73-82.92 range. Spot USDINR closed at 82.88, gain of 10 ps for USD as against prior close of 82.78.

RBI reference rate was fixed at 82.88 on  03/11. Nov USD/INR closed at 83.03, gain of 10 ps for USD as compared to prior day’s close of 82.93. Nov Euro/INR closed at 81.11, GBP/INR at 93.51 and Yen/INR at 56.22. USDINR fwd premia was trading at around 2.30% p.a.  FX reserves stands at USD 528.36 bn as on Oct 14 th.  FX reserves declined by USD 4.5 bn as compared to previous fortnight.

In Oct, FII’S bought Rs 8430 Cr of Equities and sold Rs 3028 Cr of debt till date. In this Calendar Year, FII’S have sold close to Rs 1.37 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 declined 30 points (0.17%) y’day. DOW declined 146 points (0.46%). Nikkei declined 0.06% and Hang Seng declined 3.08%.

Euro is now at 0.9769, Pound at 1.1205, Yen at 148.11.

Commodities: Gold is now at USD 1638 and WT1Crude at USD 89/Brent at USD 95.50.

Interest rates: USD 10 Yr yield is at 4.16% and 3 m libor closed at 4.44%. Indian 10 yr benchmark yield closed at 7.48%.

Economic news: S&P Global India Manufacturing PMI increased to 55.3 in October 2022 from 55.1 in September, exceeding expectations for a slowdown to 54.9 and remaining above its long-run average of 53.7.

BoE raised Bank Rate by 75bps to 3.00%. The decision was made by 7-2 votes. Tightening bias is maintained as “should the economy evolve broadly in line with the latest Monetary Policy Report projections, further increases in Bank Rate may be required for a sustainable return of inflation to target, albeit to a peak lower than priced into financial markets. ”But there are “considerable uncertainties” around the outlook. If outlook suggests more persistent inflation pressures, the Committee will “respond forcefully”. warned of a “very challenging” outlook for the economy. The central bank forecasts inflation will hit a 40-year high of around 11% during the current quarter, but that Britain has already entered a recession that could potentially last two years – longer than during the 2008-09 financial crisis.

Euro declined as ECB President Christine Lagarde said the central bank cannot just mirror Fed’s policy moves. “We have to be attentive to potential spillovers,” said. “We are not alike and we cannot progress either at the same pace (or) under the same diagnosis of our economies.”

Data highlights: – – US Weekly jobless claims dipped to 217k and ISM(non mfrg was in expansion mode at 54.4. Factory orders climbed 0.3% m/m.

-EU unemployment rate was reported at 6.6%.

-UK PMI(services-final) remained in contraction mode at 48.8.

Friday’s calendar : US employment data

-EU PPI, German factory orders

-UK PMI(construction)

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 82.46. 50 day moving average is at 81.10.200 day moving average is at 77.90. Daily MACD is in buy zone. Important support is at 82.50/82.12 and important resistance is at 83.30. Spot closed above its average level of the day.

Intraday supports and resistances for Nov contract are:

PP: 83, S1:82.92, S2:82.80, R1:83.11, R2:83.20.             

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

However on directional basis, suggest the following:

USDINR imports be hedged .

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is above 50 and 20 day major moving averages. Major resistance is at 1.01/1.02. Next major support is at 0.9845. Daily MACD is in buy zone, implying an important bottom at 0.9540. Weekly MACD is in sell zone, implying important top at 1.1498.

GBP/USD: The pair is below 50 and 20 day moving averages. Daily MACD is in buy zone, implying important bottom at 1.0380 and weekly MACD is in buy zone, implying important bottom at 1.0380. Important support is at 1.1440. Important resistance is at 1.1740.

USD/YEN: The pair is above 50 and 200 day moving averages. Daily MACD is in sell zone, implying important top at 152. Important support is at 144/140.40. Major resistance is at 152.

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