Globally,
escalating tensions between US and Iran took the centre stage as Trump threaten
to attack Iranian cultural sites. While, Iran decided to step back from nuclear
deal to underline its intents against Suleimani killing. Consequently, Crude
oil spiked to 7 month high levels of 70.50, Gold rallied to $1580, USD/JPY
tumbled to two month low 108 levels. These geopolitical tensions might remain
elevated amid plausible advantage for Trump in upcoming elections.
On domestic
front, India’s 10 year bond yields, which had rallied nearly 28 bps on
Operation Twists, rebounded to 6.54% amid prevailing geopolitical tensions. On
other hand, Today, RBI will conduct third operation twist to flatten the yield curve.
RBI will buy and sell INR 10,000 worth bonds of three different maturities of
5,7 and 10 years and sell 1 year maturity bond. On currency front, USDINR
opened the session on strong note at 72.01 against previous close of 71.795. Partially
convertible rupee is likely to trade with a weakening bias amid geo-political
tensions. USDINR pair has first resistance near 72.18-72.22 levels and second
resistance at 72.40-72.45 levels. USDINR pair has support at 71.75-80 levels. The
range for the day seen as 71.90-72.20
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