Currency Market Updates: 15-Jul

Globally, US equity market gained another 2% after the release of better than expected CPI inflation. US CPI released at 0.6% m-o-m basis against previous reading of negative 0.1%. On the other hand, Euro continued to trade with biddish bias against its US counterpart as EUR/USD pair surged to 1.1420 levels. Technically, EUR/USD pair has multiple resistance b/w 1.1430-1.1450. We can initiate short EUR/USD position near 1.14 handle with a stop of 1.1450 and a target of 1.1270. EUR/USD pair will take further cues from ECB meeting, scheduled tomorrow.  

On the domestic front, the expectations of further easing by RBI have reduced after the release of stronger CPI inflation in June. CPI inflation spiked to 6.09% in June-20 against 5.91% inflation in March-20. It is noteworthy that government had not declared CPI data for April and June. Interestingly, perishable food inflation i.e. vegetable inflation fell to 1.86% and fruit inflation contracted by 0.68%. Overall food inflation remained elevated near 7.87% due to surge in prices in non-perishable category. USD/INR pair is trading at 75.30 levels. USDINR pair has resistance near 75.45-75.50 levels and support at 75.25 levels.

Currency Market Updates: 10 Jul

Globally, the EUR/USD pair witnessed significant selling above 1.1350 levels. EUR/USD pair slipped further to 1.1275 after the release of US unemployment claims. US unemployment claims released at 1314k against the previous reading of 1413k. On the other hand, US equity markets witnessed mild correction as Dow Jones fell by more than 1%.

On the domestic front, Nifty is trading 0.5% down at 10760, tracking weakness in US equity markets. India 10 year benchmark bond yield is trading flat near 5.78%. The partially convertible rupee started to weaken as fundamental took back centre stage after completion of large inflow. USDINR pair is trading at 75.25 levels. USDINR pair has immediate resistance at 75.45-50 levels and support at 75.00 levels

Currency Market Updates: 8-Jul

Globally, the Reserve bank of Australia kept monetary policy stance unchanged with interest rate at 0.25%. Besides other FED members, Quarles also raised the concerns over economic recovery amid rising COVID-19 cases in US. On the other hand, EUR/USD pair is trading flat near 1.1275 levels after the release of German industrial production, which grew by 7.8% on a weaker base.

On the domestic front, Equity markets are holding well with nifty near 10800 levels despite the mild correction in US markets. In last two days, One of large corporate paid USDINR forward premium across the tenure leading June premium spiking to 292 levels. USDINR pair has shown an early sign of recovery with pair rebounding to 74.94 from 74.67 levels. Overall, USDINR pair has support near 74.65-70 levels and resistance near 75.10-15 levels

Currency Market Updates: 2 Jul

Globally, as FED meeting minutes, US economic data for Apr-June quarter is expected to dismal and US economy would require ultra-supportive monetary policy to support economic recovery. US FED members also discussed about the yield curve controlled. (A policy measure implemented by Bank of Japan). US manufacturing PMI data surprised on upside at 52.6 against previous reading 43.1. On the other hand, Euro manufacturing PMI released below 50 at 47.4.

On domestic front, GST collection in June month stood at INR 90,917 Cr. It is noteworthy that as Government had allowed relaxation of GST tax filing in April, May. A lot of transactions of previous months were filed in June. 10 year benchmark bond yield fell to 5.84%. USDINR pair trading flat near 75.50 levels. USDINR pair has support near 75.35-40 levels and resistance near 75.80-85

Currency Market Updates:1 Jul

Globally, noted immunologist Anthony Fauci warned against the possibility of 100k daily covid cases in US. US equity markets continue to rally largely detached of underlying conditions. EUR/USD pair is trading flat near 1.1220 levels. The pair will take further cues from manufacturing PMI data of US and Europe.

On domestic front, India witnessed marginal current account surplus of $0.6 Bn in Jan-Mar-20. Current account surplus can be attributed to narrowing trade deficit (due to lower crude and slowing economy), higher service and private receipts. On FY basis, Current account deficit narrowed to 0.9% of GDP in FY 20 against 2.1% of GDP in FY19. USDINR pair is trading flat near 75.55. USDINR pair has immediate support near 75.35-40 levels and immediate resistance at 75.80-85 levels.