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Published on 13/02/2020 11:01:07 AM | Source: ICICI Direct

Daily Currency Outlook 13 February 2020 - ICICI Direct

Posted in Currency Report| #Currency Tips #ICICI Direct

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Forex and global equities

* The rupee pared early gains to settle 5 paise down at 71.34 against the US dollar on Wednesday ahead of the release of key domestic macroeconomic data. However, as crude oil prices started reverting from lower levels, US$INR is likely to move higher

* After falling for two days, the Dollar Index again moved to 99.00 levels as the market is printing fresh 2020 highs. This will keep emerging market currency moves in check

* Equity benchmarks moved higher and ended Wednesday’s session above 12200, up 93 points

* Sectorally, FMCG, auto and financials (ex-PSU banks) outshone while pharma underperformed

 

Debt and FII activity

* The yield on 10-year bond rose 0.14% and ended at 6.48 yesterday compared to 6.47

* US treasury yields rose on Wednesday as hopes that a slowdown in the cases of COVID-19--the name for the novel disease originated in Wuhan, China in late 2019--sparked a global equity rally and weighed on haven demand

* Gold prices remained muted for a second day on a row. However, demand for safe haven assets may increase as reported new rose after revising the method for counting infections

* Crude oil prices moved to $56 as there was an expectation of some pick-up in crude demand in China as they started disinfecting cities

* Foreign institutional investors (FII) were net buyers to the tune of | 2246 crore in equities on February 11, 2019. For the month, they remained net buyers of | 25378 crore

 

INR futures and Outlook

* The dollar-rupee February contract on the NSE was at 71.43 in the previous session. Open interest rose 5.25% in the previous session

* Utilise downsides in the pair to initiate long positions

 

US$INR currency

 

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