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Rupee Outlook and Strategy

• The US dollar index edged up on Friday as job data from the US signalled that the Fed may increase interest rates by another 25 bps in the next meeting. Unemployment rate in the US declined to 3.5% in March 2023 against expectations of 3.6% and non-farm payrolls increased by 236,000 in March compared to market forecast of 228,000

• Rupee future maturing on April 26 appreciated by 0.17% on Thursday amid an uptick in domestic equity markets

• The rupee is likely to trade with a negative bias amid strong US dollar index. Further, the rupee may depreciate as the Reserve Bank of India keeps interest rates unchanged at 6.50%. Meanwhile, a sharp depreciation may be prevented on FII inflows in domestic equity markets. US$INR is expected to trade towards the level of 82.20 as long as it sustains above the key support level of 81.90

Euro and Pound Outlook

• The Euro depreciated by almost 0.20% on Friday amid a strong US dollar. Further, the Euro came under pressure as Italy is likely to confirm its budget deficit targets for this year and next as the Treasury aims for tighter fiscal policy to limit the impact of rising eurozone interest rates

• The Euro is expected to trade on a bearish note amid strength in the US dollar index. EURUSD is likely to break the key support level of 1.0880 to continue its downward trend towards the level of 1.0860. EURINR is expected to trade in downward trend towards the level of 89.00

• The pound continued to trade in a downward trend on Friday amid a strong US dollar index. Further, the pound tumbled as the US economy added more jobs than market expectations

• The pound is expected to trade with a negative bias amid rise in US dollar index. GBPUSD is likely to break the key support level of 9 DMA at 1.2400 to continue its downward trend towards the level of 1.2360. GBPINR is expected to trade in downward trend towards the level of 101.80

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