IGI Logo

Dollar gains as Fed Minutes Spur Taper Concern

Rupee declined, ended a three-day win streak, as dollar index recovered from multi month low. A gauge of the dollar’s strength climbed along with U.S. Treasury yields after minutes from the Federal Reserve’s last meeting revealed that some officials would be open to discussing scaling back the central bank’s massive bond purchases “at some point.” Concern surrounding the impact of inflation on monetary policy dragged riskier assets and commodities lower while safe have currencies and commodities gained.

.The rupee and the Sensex are leading gains in Asia over the past month despite record death tolls and infection rates. Rupee gained 1.2% to 73.17 a dollar so far this month following weaker dollar and dollar inflows.

On Wednesday, spot USDINR closed at 73.17 gained 12 paise or 0.17%, gained after falling for three consecutive days. There were central bank’s intervention around 73 odd level along with importers dollar demand on Wednesday.

USDINR has resistance at 73.3505, 100-DMA and 73.7738, March 1 high while find support at 73.000, psychological followed by 72.7500, March 29 gap high

sian stocks looked set for a mixed open Thursday after U.S. shares dipped and Treasury yields rose in the wake of Federal Reserve minutes that flagged the possibility of a debate on scaling back asset purchases. However, that conversation took place before the most recent disappointing employment and retail sales reports, which showed the U.S. economy growing at a slower pace than projected. The benchmark 10-year Treasury yield climbed to 1.67% in U.S. hours.

The euro erased gains after earlier climbing to $1.2245, the highest level since January as bets mounted the ECB will taper its pandemic bond-buying program in the summer.

USDINR

USDINR May futures formed bullish candle near psychological support of 73 which is coincidentally gap support.

The pair is about to give death cross over by 50 DMA crossing 200 DMA downward suggesting medium term bearishness.

Momentum oscillators placed near oversold zone indicating consolidating before heading lower.

USDINR May futures expected to trade in the range of 72.70 to 73.30 with overall bias remains bearish, near term consolidation can be seen.

To Read Complete Report & Disclaimer Click Here

Please refer disclaimer at https://www.hdfcsec.com/article/disclaimer-1795

SEBI Registration number is INZ000171337

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaimer