IGI Logo

Rupee Outlook and Strategy

• The US dollar index gained by 0.52% on Friday amid stronger-thanexpected US Service PMI numbers, which rose to 53.8 against previous reading of 50.6. Additionally, improvement in the manufacturing PMI numbers towards the 50 mark has supported the dollar index to rise above the 103 mark. Further, hawkish comment from the Fed member Bullard supported the dollar when he raised forecast for peak interest rates this year to 5.625% from 5.375%

• Rupee future maturing on March 28 depreciated by 0.24% to 82.45 amid weakness in domestic equities

• The US$INR is likely to consolidate at 82.10-82.50 with a tilt on the bull side. Further, weakness in global risk sentiments amid rising banking concerns in Europe would hurt rupee. For the day US$INR, is likely to hold 100 day EMA support at 82.10 and move towards the key five day EMA resistance at 82.50. Only a move above 82.50 would inch higher towards 82.74

Euro and Pound Outlook

• The Euro slid the most on Friday after European banking concerns diminished the bullish bets on the Euro. The European banks with high exposure to corporate lending were hit the most on Friday. Additionally weaker set of Manufacturing PMI numbers also weighed over the Euro to trim its weekly gains

• The Euro is expected to trade on a weaker note amid strong recovery in dollar and weakness in the European banking sector. Rising worries over potential contagion beyond regional banks threatening to spread to their larger peers would also weaken the Euro. The pair is likely to dip towards the immediate support zone of 1.0670 as it reversed from the higher end of the Bollinger band channel at 1.0920. EURINR (March) is likely to dip towards the 20 day EMA at 88.00, as long as it remains under 89.60

• The pound moved down 0.46% against the dollar as recovery in dollar coupled with weaker manufacturing numbers from UK has forced the pair to slide below the key support 1.2240. Further, weaker consumer confidence numbers also added downside pressure on the pair

• The pound is likely to face the resistance of 1.23 (higher Bollinger band) and move towards the immediate 10 day EMA support at 1.2180. The expectation of decline in CBI realised sales number would weaken the pair. Further recovery in dollar could also restrict the pair to go beyond 1.23 mark. The oscillator(Stochastics) is suggesting overbought condition, which could bring an intermediate correction in the pair. GBPINR (March) is expected move towards 100.30-100.10, as long as the pair trades below 101.30

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