Currency Map:

EUR/INR             84.48    85.11 -0.74
GBP/INR 95.91 96.84           -0.96
JPY/INR 0.6515 0.6556 -0.62
USD/INR 73.33         73.56 -0.31

Major highlights: Rupee continued to recover on the back of softening of crude prices and lower than expected trade deficit in Sept (USD 13.98 bn).Exports declined 2.5% y/y to USD 27.95 bn and imports expanded 10.45% in Sept to USD 41.9 bn. Imports has climbed 16.6% in Apr-Sept period over last year.

-Crude declined further last week. WT1 Crude closed the week at USD 69.35. WT 1 Crude had earlier rallied to USD 76.

-Indian Equities had a roller coaster ride with significant decline on Friday. Frontline stocks took beating despite robust results in Q 2.

-Indian FX Reserves declined 5.4 bn USD in week ended Oct 12 th. FX reserves is now at USD 394.4 bn. FX reserves had touched USD 426 this Year.

-FII’S were nett sellers last week in Equity and debt markets.FII’S have sold Rs 18111 Cr of Indian Equities in Oct till date . FII’S have sold Rs 11497 Cr of Indian debt securities in Oct till date . On a cumulative basis, FII’S have sold Rupees 27734 Cr of Indian Equities till date for this calendar year and have sold  Rupees 60798 Cr of Indian debt in this calendar year till date.

-Chinese GDP in last quarter dipped to 6.5%.

-MOODY’S downgraded Italy, which is having a showdown with EU on budget deficit goal.

-US FOMC minutes was more hawkish than expected. Interest rates set to climb in 2019 and 2020 on the back of robust economy and strong labor data.

-UK-EU standoff continues on BREXIT deal.

-US threatens Saudi with sanctions over political row.

Next week important events: ECB meeting.

Projected range for coming week: USDINR: 73-74.50, EURINR:83.50-85.50, GBPINR:94.50-97.

Suggestions: Hedge USD payables on decline to 73.30-73 and hedge EUR payables 

on decline to 83.50. GBPINR exports be hedged partly.


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