USD/INR Open down on waning Brexit fears after UK shortlist next
PM
Dollar/rupee open slightly down on Wednesday on likely overseas funds
inflows into local shares investors chase higher-yielding riskier assets as
fear of uncertainty about Brexit waned following UK shortlisting Theresa May as
the potential next PM.
India's industrial production rose to a 3-month high in May led
by a expansion in manufacturing sectors. IIP expanded 1.2% in May compared with
downwardly revised 1.3% contraction a month ago, government data showed Friday
Globally, Japanese Prime Minister Shinzo Abe ordered a new round
of fiscal stimulus spending after an election victory. Such expectations pushed
down the yen 4% over the last two days.
Elsewhere, the Bank of England makes its policy announcement on
Thursday, with some players expecting a rate cut. The European Central Bank is also
widely expected to take a dovish stance when it holds its policy review a week
later.
This saw the demand for safe-have dollar plunged sharply against
the pound and euro. This was also due to Bank of England Governor Mark Carney
comment that there would be no "credit crunch" like the one
experienced in 2008 and 2009.
Meanwhile, India's retail inflation accelerated to a 21-month
high in June mainly due to rise in food inflation led by vegetables, government
data showed Tuesday.
India's Consumer Price Index-based inflation accelerated to
5.77% in June -- its highest level since August 2014 -- compared with 5.76% a
month ago, data released by the government showed Tuesday.
India's industrial production rose to a 3-month high in May led
by a expansion in manufacturing sectors.
India's Index of Industrial Production expanded 1.2% in May
compared with downwardly revised 1.3% contraction a month ago, government data
showed Friday.
USDINR settled almost flat 67.3250 on
Tuesday. Recently pair broke the its crucial support
67.50 which coincided with 50% Fibonacci
Retracement of its previous short term rally and settled at 67.2825 levels.
On the hourly chart, pair
forming like Head & shoulder pattern which is indicating for bearishness in
USDINR and breakdown of neckline support is aiming for the target 66.85-66.70
in days to come.
Sell below 67.20 Target 67.00-66.85.
Stop loss above 67.40, else wait for rise towards 67.6-67.70.
EUR-INR July Future
Euro traded up for the second day Tuesday as uncertainty over
the UK's political scene diminished with imminent appointment of Home Secretary
Theresa May as the next UK prime minister.
Sell strategy given around 74.70-74.80 was initiated, but pair
yet to test predicted level of 74.25. On the EOD chart pair formed a high wave
candle stick which is indicating for indecisiveness in near term.
There is strong resistance at 75.25 and any rise towards
74.80-75.00 is expect to attract huge selling activities unless it give a
closing above 75.25.
GBP-INR July Future
Pound gained most in over two-weeks Tuesday as investor
sentiments were lifted after UK's Conservative Party's Home Secretary Theresa
May was announced to become the next British Prime Minister.
Hammer candle stick was resulted in more than 1.00% recovery in
GBPINR, and breaching the resistance 87.70 pair tested predicated level of
88.40 ( day high was at 88.71). In Near term pullback expect to continue
towards 89.00-89.40 before any plunge as long term trend is yet bearish in
GBPINR.
JPY-INR July Future
Yen traded at over one-week low Tuesday on speculation that the
Japanese government would unveil fresh in near term. Yen weakened further
against major currencies Tuesday following its fall of 2.2% against the US
dollar Monday, its sharpest fall since Oct 2014
JPYINR extended its recent bearish trend, and after breaching
65.50 tested 64.75 levels. A double top pattern is found on EOD chart which is
indicating for drastic fall in days to come and break below 64.70 is expect to
show 64.20-64.00 on the downside.
Major
Economic Data & Events Schedule today
|
Time
|
Currency
|
Economic Indicators
|
Forecast
|
Previous
|
Possible
Impact
|
|
Tentative
|
CNY
|
Trade Balance
|
320B
|
325B
|
Negative
|
|
Tentative
|
CNY
|
USD-Denominated Trade
Balance
|
46.0B
|
50.0B
|
Negative
|
|
10:00am
|
JPY
|
Revised Industrial
Production m/m
|
-2.20%
|
-2.30%
|
Negative
|
|
12:15pm
|
EUR
|
French Final CPI m/m
|
0.20%
|
0.20%
|
Neutral
|
|
13th-16th
|
CNY
|
M2 Money Supply y/y
|
11.40%
|
11.80%
|
Negative
|
|
13th-16th
|
CNY
|
New Loans
|
1000B
|
986B
|
Positive
|
|
2:00pm
|
GBP
|
BOE Credit Conditions Survey
|
-
|
-
|
-
|
|
2:30pm
|
EUR
|
Industrial Production
m/m
|
-0.80%
|
1.10%
|
Negative
|
|
Tentative
|
EUR
|
German 10-y Bond
Auction
|
-
|
0.01|1.1
|
-
|
|
6:00pm
|
USD
|
Import Prices m/m
|
0.60%
|
1.40%
|
Negative
|
|
10:31pm
|
USD
|
30-y Bond Auction
|
-
|
2.48|2.4
|
-
|
|
11:30pm
|
USD
|
Beige Book
|
-
|
-
|
|
|
USD
|
Federal Budget Balance
|
24.2B
|
-52.5B
|
Positive
|
