Currency Report 30 - January 2017
Rupee extends gains for third straight session
Extending gains for the third straight session, Indian rupee ended marginally stronger against dollar on Friday, due to selling of greenback by banks and importers.
Market participants got some comfort with the report indicating that money in circulation is rising again in India post-demonetisation period and at the current rate, currency-to-GDP ratio will reach about 9 per cent by March -- sufficient to stabilise economic activity. Some support also came with Union Finance Minister Arun Jaitley’s statement that the Indian economy is set to grow at a healthy rate in spite of the global economic slowdown in the coming years, because of important initiatives taken by the present NDA Government that are demonetisation, encouraging free trade and Goods and Services Tax (GST).
Moreover, firm domestic equity market supported the rupee, but the dollar strengthened against some currencies overseas capped the gains. On the global front, yen came under downside pressure on Friday with Bank of Japan’s (BOJ) decision to increase purchases at regular JGB-buying operation was seen as a message that tapering of the central bank's asset-purchase program is off the table at is policy meeting on Tuesday next week.
Finally, the rupee ended at 68.03, 4 paise stronger from its previous close of 68.07 on Wednesday. The currency touched a high and low of 68.23 and 68.03 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 68.20 and for Euro stood at 72.74 on January 27, 2017. While the RBI’s reference rate for the Yen stood at 59.24, the reference rate for the Great Britain Pound (GBP) stood at 85.49.The reference rates are based on 12 noon rates of a few select banks in Mumbai.
USDINR
Support at 68.20 and Resistance 68.40
Break and sustain below 68.20 will take it to 68.00---67.90 and then to 67.60 mark else it could touch its resistance level of 68.40 again.
Fresh buying can be initiated above 68.40 only.
GBP-INR
Support at 85.50 and resistance at 86.20
Break and sustain above 86.20 will take it to 86.50--86.80 and then to 86.95+ mark else could touch its support level of 85.50
Looks weak if closes below 85.50
EURINR
Support at 73.10 and resistance at 73.40—73.55
Break and sustain below 73.10 will take it to 72.80—72.55 and then to 72.30 else could touch its resistance level of 73.40—73.55
Fresh buying can be initiated above 73.55
JPYINR
JPY-INR unable to breach its resistance levels of 59.80 and slipped.
Now what to expect??
Support at 59.35 and resistance 59.80
Break and sustain below 59.35 will take it to 59.10—59.00 and then to 58.70 else could touch its resistance level of 59.80
Fresh buying can be initiated above 59.80
More will update soon!!
