USD/INR open down as dollar Index at near 1-week low

USD/INR open down as dollar Index at near 1-week low

Dollar/rupee extended losses for the second straight day, while the dollar index declined to near one-week low Thursday as investors booked profits on the greenback's recent rally amid stronger oil prices.

  

Dollar index, which tracks the strength of the greenback against a basket of six currencies, snapped a six-day gain to trade at 93.86 during early Asian trade compared to 94.26 at close New York time.

 

The dollar had risen in recent days as investors moved to cover bets against the US currency.

But recent hawkish comments from Federal Reserve officials led investors to cover those positions amid concerns that they were underestimating the central bank. 

Technically, USD-INR retraced from the day high 67.06, and tested 66.7875 before closing at 66.80 levels. A formation of long bearish candle stick on EOD chart is indicating for further correction in USDINR. 

Since 27 April 2016, pair has turned neutral and squeezed in a cluster of support 66.55 and immediate resistance of 67.00 (on closing basis).   

With that in mind, short term consolidation is expect to continued unless USDINR give either side break, any rise towards 66.90-67.00 could attract short term selling activities with stop loss above 67.30.

EUR has stalled its six-day losing streak, ahead of BOE inflation report

Euro snapped 6-day fall tracking a weak dollar as investors booked profits in their dollar holding after continuous rally in the greenback against the common currency.

Sell strategy given around 76.35 was activated and EURINR tested 76.12 before closing at 76.1475 levels. A strong retracement from 23.8% of the previous fall is indicating for bearishness in EURINR.

 Near term support is seen at 75.95 and correction is expected to come below these levels only, else any rise towards 76.35-76.50 may attract huge selling activities.

GBP-INR drop retraced from day high after weak U.K. factory data

Pound traded down Wednesday as latest polls done by market research firm ICM showed Brexit possibilities still remain high. Pound also weakened as UK March industrial and manufacturing production fell short of expectations.

U.K. Industrial production grew 0.3% month-on-month in March, reversing a 0.2% fall in February. Nonetheless, it was slower than the 0.5% rise forecast by economists.

U.K. U.K. Office for National Statistics said that manufacturing production increased by a seasonally adjusted 0.1% in March, worse than expectations for a rise of 0.3% and following a decline of 0.9% a month earlier, that was revised down from an initial read of a 1.1% drop

GBPINR continued to trade below its near term resistance 97.40 for sixth consecutive day, while retracing from every rise 97.05-97.10 levels. 

 It’s expected that GBPINR may remain under pressure unless it gives a closing above 97.40.

 Further, GBPINR would need to trade above these levels in order to test 97.80-98.00.

Yen turn neutral after current account data

Yen posted its biggest loss in nearly two weeks Wednesday against the dollar on profit booking in dollar after the greenback spiked over 2% in the last two days on verbal intervention by the Japanese policymakers, while remained neutral against Rupee.

In n Japan, the adjusted current account for April came in at a surplus of ¥1.89 trillion, narrower than a surplus of ¥1.90 trillion seen. Of note, foreign investments in Japanese stocks fell ¥434.6 billion in April, while bond purchases by foreigners reached ¥270.3 billion.

Also in Australia, MI inflation expectations edged down to 3.2% from 3.6%.

 JPYINR has stalled its recent bearish move and consolidated around 61.50 in entire day. However, near term trend is looking bearish following to a breakdown of crucial support 61.90.

Further, there is strong resistance of 61.95 and JPYINR would need to trade above this level in order to test 62.50-63.00

Major Economic Data & Events Schedule today

Time	Currency	Economic Indicators	Forecast	Previous	Possible Impact
9:15am	JPY	30-y Bond Auction	-	0.39|3.4	-
10:30am	JPY	Economy Watchers Sentiment	44.90	45.40	Negative
11:30am	EUR	German WPI m/m	0.20%	0.30%	Negative
12:15pm	EUR	French Final CPI m/m	0.10%	0.10%	Neutral
12th-16th	CNY	M2 Money Supply y/y	13.50%	13.40%	Positive
12th-16th	CNY	New Loans	820B	1370B	Negative
2:30pm	EUR	Industrial Production m/m	0.10%	-0.80%	Positive
4:30pm	GBP	BOE Inflation Report	-	-	-
	GBP	MPC Official Bank Rate Votes	0-0-9	0-0-9	-
	GBP	Monetary Policy Summary	-	-	-
	GBP	Official Bank Rate	0.50%	0.50%	Neutral
	GBP	Asset Purchase Facility	375B	375B	Neutral
	GBP	MPC Asset Purchase Facility Votes	0-0-9	0-0-9	Neutral
5:15pm	GBP	BOE Gov Carney Speaks	-	-	-
6:00pm	USD	Unemployment Claims	277K	274K	Negative
	USD	Import Prices m/m	0.60%	0.20%	Positive
12th-13th	USD	Mortgage Delinquencies	-	4.77%	-
9:15pm	USD	FOMC Member Rosengren Speaks	-	-	-
10:31pm	USD	30-y Bond Auction	-	2.60|2.4	-

More will update soon!!