Published on 10/07/2017 4:49:22 PM | Source: Angel Broking Pvt Ltd
EURINR spot (CMP - 73.58) is expected to trade lower - Angel Broking
In the last week, the Indian Rupee spot strengthened marginally by 0.02 percent owing to:
* The newly adopted tax regime in India i.e. the GST bill has revived positive sentiments on hopes that it shall lead to higher foreign direct investment inflows and boost the economy.
* RBI announced another open market sale of bonds thereby prompting market participants to bet the central bank may carry out more such operations to drain excess liquidity from the banking system.
* Furthermore, persistent selling of US Dollar by exporters and banks added to rupee’s strength.
* Also, disappointing release of FOMC meeting minutes where there was lack of consensus seen amongst the policymakers on timing and approach strategy to shrink its balance sheet in a time of low inflation.
* From a weekly perspective, USDINR spot (CMP – 64.53) is expected to appreciate tracking gains in the Asian market currencies as markets after the better-than-expected outcome of G-20 summit where the world leaders argued lesser than expected thereby brightening overall market sentiment.
* In the last week, EURINR spot plunged by 0.14 percent after some ECB policymakers commented on having doubts about signalling a move away from an ultra-easy monetary policy stance.
* Moreover, France’s top central banker has pleaded with Germany to loosen its fiscal policy as part of a deal with his country to strengthen the Euro-zone.
* In the recent G-20 summit, the German Chancellor Angela Merkel stated that she was finding agreement on trade proving difficult which acted against the Euro’s strength.
* Also, strong US Dollar Index after the release of NFP employment data added to the woes.
* From a weekly perspective, EURINR spot (CMP –73.58) is expected to trade lower as lack of important economic data releases from the zone will keep the trading volumes a bit light.
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