Posts tagged forex
USD-INR Charting its own course…
Equity markets continued their journey north with all major markets closing in the green for the week. The Sensex was up 100 points with indices worldwide crossing recent highs. Gold ended unchanged from last week at 1107. The European leaders seem to have a worked up an arrangement to help Greece ending the long stalemate between the leaders. The help from IMF might be necessary and unavoidable but does not bode well for the European Union. The US Dollar strengthened across the board rising against all major currencies. Supported by strong fundamentals inside and sovereign worries in other parts of the world the USD continues to stage a notable rally. On the contrary the USDINR seems to be much less affected by risk appetite in the global front. While the USD strengthened against almost all currencies it depreciated almost 30 paise over last week against the INR before closing at 45.23-24 levels. Strong fundamentals and high returns are driving capital inflows in the country could drive the USDINR further down however we see strong support at these levels and some importer demand might take the pair to 45.50 levels this week.
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USD-INR retracing the fall
The USD/INR retraced the highs of 45.28 and has settled at around 45.78 levels. Equity markets were directionless with the Sensex and the Nifty closing a tad lower than last week. The high point from the data point was the 11.3 % growth in IIP against expectation of 10%. Inflation for the month of December was 7.31% which was as per expectation. In Euro news, the ECB kept rates unchanged but reiterated the need for fiscal discipline from its member states. While we expect the USD/INR to be more weighed by foreign inflows and underlying strength of the Indian economy, momentary surges in the US dollars may take the pair back above 46 levels.
USD/INR Downside Prevails
The week saw consolidation across the board with all equity markets rebounding from the selling momentum of last week. The Sensex rebounded around 700 points. Similarly all major indices have risen defying the fact that unemployment still is a concern for the US. The Euro broke the 1.5000 mark during the week and currently trades at 1.49. The forecast for the pair still remains bullish with more buying expected during the week adding to more bearish sentiments to the USD.
Exchange Rates
| Major pairs | 06/11/2009 | 14/11/2009 |
|
EUR USD |
1.4879 |
1.4903 |
|
GBP USD |
1.6607 |
1.6676 |
|
USD JPY |
90.64 |
89.29 |
|
USDINR |
46.80 |
46.34 |
|
GBPINR |
46.80 |
46.34 |
|
100JPY/INR |
52.07 |
51.57 |
|
EURINR |
69.49 |
68.87 |
Key International Indices and Commodities
| Index |
06-11-2009 |
14-11-2009 |
| DowJones |
10023.42 |
10270.47 |
| NASDAQ |
2112.44 |
2167.88 |
| SENSEX |
16158.28 |
16848.83 |
| NIFTY |
4796.15 |
4998.91 |
| FTSE |
5142.72 |
5296.38 |
| NIKKEI |
9789.35 |
9770.31 |
| GOLD |
1092 |
1116.70 |
| OIL |
78.51 |
76.35 |
USD/INR Weekly outlook
The USD INR broke the 46.77 support level during the week and was bearish for major part of the week. Every uptick continues to add more shorts to the market and upside remains far off at 46.77 levels. Upside can only be confirmed if it breaks above these levels. More downside would be confirmed if break above 46.35 levels is confirmed.
