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Rupee likely to open slightly left on risk-off sentiments

Rupee likely to open steady following listless trading activities on global forex markets. The dollar index has been swinging around 92 odd levels. Brent crude oil prices came below $75 a barrel ahead of OPEC+ meeting which could help rupee in today’s trade. Indian rupee heads for the biggest monthly decline after March 2020 following higher crude oil prices, weaker Asian(regional) currencies and foreign fund outflows. So far this month, rupee depreciated 2.22% or 161 paise against American dollar.

Asian stocks are set for a steady start after U.S. shares edged up to a fresh record on economic optimism and signs that vaccines can counter the highly infectious delta strain.

On Tuesday, spot USDINR closed at 74.23 up 4 paise or 0.05% following weaker domestic equities and steady dollar index. The pair has been awaiting from fresh triggers to break the last fifteen days’ range of 74 to 74.50. By the end of the week, we could see some directional trend once the manufacturing data outs from domestic as well as from global.

The dollar and yen strengthened versus Group-of-10 currency peers Tuesday as haven demand outweighed appetite for riskier assets, driven by concern over the spread of a more infectious Covid-19 variant.

From data front, US consumer confidence soared in June to a fresh pandemic high as Americans become more upbeat about economy and job market. Conference Board’s index increased to 127.3 from an upwardly revised 120 reading in May, according to a report Tuesday.

Federal Reserve Governor Christopher Waller said the better-than-expected performance of the U.S. economy warrants scaling back asset purchases sooner than expected and he favors starting with mortgage backed securities.

USDINR

USDINR July futures consolidated in narrow range of mere 8 paisa on Tuesday. It has been consolidating in the range of 74.75 to 74.40 since last fifteen days.

The pair is having strong resistance at 74.75, the 50% Fibonacci retracement adjoining high of 76.40 and 73.

Momentum oscillators and indicators are also flattened but remained on positive side.

We believe USDINR July futures expected to stay in the range of 74.40 to 74.75 in next couple of days before heading towards 75 level.

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