IGI Logo

Rupee Outlook and Strategy

• The US dollar rallied yesterday amid a surge in US treasury yields and risk aversion in global markets. However, sharp upside was capped on disappointing economic data from the country. US pending home sales fell far more than expected in November. It also fell for a sixth consecutive month indicating the hefty toll the Fed rate hike is taking on the housing market

• Rupee future maturing on January 27 appreciated marginally by 0.04% tracking muted dollar and softening crude oil prices. Meanwhile, sharp gains were prevented on risk aversion in global markets and FII outflows

• The rupee is likely to depreciate today mainly on the back of a firm dollar, persistent FII outflows and risk aversion in global markets. However, a sharp fall may be prevented on a decline in crude oil prices. Oil prices slipped on concerns over a surge in Covid-19 cases in China. US$INR (January) is holding support near 82.75 level. As long as it sustains above this level it may rise back to 83.20 levels

Euro and Pound Outlook

• The Euro depreciated by 0.25% yesterday on the back of a strong dollar and pessimistic global market sentiments. However, sharp downside was cushioned as ECB policymakers signalled that rate hikes would need to continue

• The Euro is expected to trade with a negative bias for the day amid a firm dollar and risk aversion in global markets. Additionally, series of disappointing economic data from euro area indicates that region is going through sharp slowdown. EURUSD is facing resistance near 1.0680 levels. As long as it sustains below this level, it may slip back to 1.0570 levels. EURINR (January) is expected to trade in a range of 88.00-88.70

• The pound appreciated marginally by 0.02% yesterday as Britain’s markets reopened after a long weekend. However, sharp upside was capped on a firm dollar and risk aversion in global markets

• The pound is expected to trade with a negative bias for the day amid gloomy global market sentiments and a strong dollar. Further, the pound may slip on worries that the UK economy remained stuck in a stagflationary environment. GBPUSD is likely to fall back till 1.1950 level as long as it sustains below 1.2100 level. GBPINR (January) is expected to trade in a range of 99.60-100.30

To Read Complete Report & Disclaimer Click Here

Please refer disclaimer at https://secure.icicidirect.com/Content/StaticData/Disclaimer.html
SEBI Registration number INZ000183631

Above views are of the author and not of the website kindly read disclaimer