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Currency Outlook:

Rupee Outlook:

• Rupee depreciated marginally yesterday as hotter than expected inflation figures from US clouds rate cut outlook. Further, data prompted investors to trim bets for deeper and early rate cuts from Fed.

• Rupee is likely to appreciate today amid soft dollar and decline in US treasury yields. Dollar fell back from 3-month high and Yields drifted lower following dovish comment from Fed official about the timing of possible interest rate cuts. Moreover, expectation of disappointing economic data from US will weigh on dollar. Additionally, softening of crude oil prices and rise in risk appetite in the global markets may aid rupee to gain strength. USDINR Feb likely to slip towards 82.85 levels as long as it sustains below 83.15 levels

Euro and Pound Outlook:

• Euro gained by 0.18% yesterday amid weak dollar and optimistic global market sentiments. Additionally, better than expected economic data from euro zone and hawkish comments from ECB supported single currency. For today, EURUSD is likely to hold the support near 1.0690 level and rise towards 1.0770 level amid soft dollar and rise in risk appetite in the global markets. Meanwhile, investors will remain cautious ahead of ECB President Lagarde speech and economic data from euro zone to get fresh cues on interest rate outlook. EURINR Feb may rise towards 89.50 level as long as it trades above 88.80 levels.

• Pound is expected to slip further towards 1.2530 level as fresh data showed inflation in UK did not accelerate in January as anticipated, releasing some pressure on BOE to keep rates steady for longer duration. Meanwhile, investors will remain vigilant ahead of GDP data from Britain. GBPINR Feb is likely to move south towards 103.80 level as long as it stays below 104.60 levels

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