Published on 20/03/2017 3:24:45 PM | Source: Angel Broking Pvt Ltd
EURINR is expected to trade in a range-bound - Angel Broking
Last week, USDINR spot appreciated by around 1.6 percent owing to the following factors:
* BJP’s massive victory in the major state election has created good sentiments in the Indian market leading to appreciating rupee and higher equities.
* The victory has not only brightened India’s future economic outlook but has also inviting huge foreign inflows into equity/debt markets.
* On the international front, the US Federal Reserve raised borrowing rates but refrained from signalling a faster pace of tightening this year.
* This dented the demand for the American currency against the Indian Rupee which worked in the latter’s favour.
* From a weekly perspective, USDINR spot (CMP-65.41) is expected to depreciate towards 66.20 levels as recent strength in the currency will prompt the traders to place fresh bets.
* Moreover, markets remain cautious ahead of the Yellen speech that is to be held later in the week so as to take cues for future developments on interest rates.
* Last week, EURUSD traded higher by 0.62 percent while EURINR plunged by 1.04 percent; all thanks to rupee appreciation.
* In the international markets, the reason for this upsurge in Euro currency was the easing concerns of Dutch elections.
*Netherlands' centre-right Prime Minister Mark Rutte won maximum votes against the anti- Islam, antiEU Geert Wilders in an election that was held on 15th March’17.
* This win was a huge relief to other EU governments facing a wave of nationalism.
* Furthermore, weakness in the US Dollar Index post the FOMC policy meet added to Euro’s strength.
* From a weekly perspective, EURINR spot (CMP-70.40) is expected to trade in a range-bound manner as easing concerns of Dutch elections will prompt traders to place fresh bets.
* However, upcoming Yellen Speech will keep the American currency volatile which will influence the trend of the Euro.
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