FX RATES AND USDINR FWDS :
Major developments:
USD is now at 83.22. USDINR opened at 83.23. Fwd premia – 1 year fwd premia is at 1.74% p.a.
-Indian CPI fell to 3 months low of 5.02% as food inflation eased to 6.56%.
-Indian IIP climbed 10.3%. Mfrg sector climbed 9.3% in Aug.
-US CPI was in line with expectation, climbing 3.7% y/y. Core CPI eased to 4.1% y/y.
USDINR View: RBI’S intervention keeps Rupee away from significant decline. On the downside, USDINR may have strong support at 83/82.80. Rupee’s Monthly range (hi/lo) is the lowest in last 15 months. It shows how volatility is being controlled by RBI. Implied volatility is below 3% p.a. now. It used to average 5% and spike to 8% during Rupee weakness. Expect 83-83.70 range for USDINR in Oct.
RBI rates
| Trade Date | 1 USD | 1 GBP | 1 EUR | 100 YEN |
| 12-Oct-23 | 83.18 | 102.55 | 88.48 | 55.83 |
-USDINR is at 83.22.Prior day’s close was 83.23.
-Indian Equity indices decline.
-Indian 10 year G-SEC yield is at 7.32%.
-USDINR 1 yr fwd premia is at 1.73%.
USDINR @ 83.22, EUR/USD@ 1.0549, GBP/USD @ 1.2203, USD/JPY @ 149.64, EUR/INR @ 87.78, GBP/INR @ 101.55, JPY/INR @ 55.62. Gold@1876, Brent Crude @ 86.50, Nifty @ 19686(-107), 10 Year G-SEC @ 7.32%.
Hedging:
USDINR payables can be hedged at 83. Eur receivables can be hedged now and on rally 88.70.
GBPINR receivables can be hedged closer to 103.75.
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