Globally, US 10 year bond
yield eased nearly 7 bps after mixed comments by Powell. US FED governor
maintained that current monetary policy remained appropriate given moderate
growth expectations, tightening labour markets and inflation expectations of
below 2%. Future funds rates currently pricing less than 45% chance of rate cut
in next one year. On other hand, safe haven currencies Yen and CHF traded with
biddish bias amid lack of clarity on US-China trade deal.
On domestic front, India’s
headline CPI inflation spiked to 16-month high of 4.62% lead by elevated food
inflation, with vegetable inflation at 26% (MoM). More importantly, Core inflation
remained under-check at 3.3%, hence should not hamper RBI’s December rate cut
expectations.
USDINR pair opened the
session on a flat note at 72.07 levels against previous close of 72.06. Range
for the day for USDINR 71.90-72.40 levels.
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