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Currency Outlook:

Rupee Outlook:

• Rupee appreciated on Wednesday amid inflow of funds into the domestic market. Dollar sales from both local and foreign banks lifted the rupee to its strongest level in this week. The rupee ended at 83.04 against its previous close at 83.11.

• Rupee is likely to trim its earlier gains amid rebound in the dollar. Hawkish comments from the Fed chair Jerome Powel would support the dollar to regain its strength. Meanwhile, drop in US treasury yields could limit any major gain in the pair. In the meantime, investor will keep an eye on domestic annual budget today. USDINR Feb is likely to consolidate hit the lower ban of the range 83.00-83.30. Only close below 83.00 it would slide towards 82.80. On the other hand a move above 83.30 it would test 83.40 mark

Euro and Pound Outlook:

• Euro pared all its gains and lose around 0.25% on Wednesday amid strong rebound in the dollar. Also weighing on the Euro was the less than expected rise in German CPI and fall in retail sales numbers. EURUSD is likely to weaken towards 1.0810 amid strong dollar and expectation of softness in inflation estimates in Eurozone. EURINR February is most likely to move towards 89.80, as long as it trades under 90.30. Only a move above 90.30 it would rise towards 90.50.

• Pound also trimmed its earlier gains amid strong rebound in the dollar. The pair is expected to weaken further towards the key support at 1.2650. Meanwhile, traders await outcome from the BOE policy today. The pair is expected to consolidate in the band of 1.2650 and 1.2730 before the outcome of the policy. Close below 1.2650 would weaken it towards 1.2610. GBPINR is likely to dip towards 105 as long as it trades under 105.80

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