India Rupee Review:Dn as bks cut short dlr bets; fall in yuan weighs

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India Rupee Review:Dn as bks cut short dlr bets; fall in weighs

Monday, Jan 20

 

By Mimansa Verma

 

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MUMBAI – The rupee fell against the dollar today because strong resistance around 71.00 a dollar prompted banks to cover their bets placed in favour of the Indian currency, and also as weakness in domestic equities dampened the sentiment for the Indian currency, dealers said.

 

Further, the rupee was said to have closely tracked the Chinese yuan, which retreated from its highest level in six months hit earlier in the day. 

 

After rising to as high as 71.0300 a dollar earlier in the day, the rupee was at 71.1000 a dollar at 1700 IST against 71.0800 on Friday.

 

In the absence of significant triggers, the rupee drew some support from the strength in Chinese yuan earlier in the day. The yuan was boosted by stronger parity rate set by The People’s of China at 6.8664 a dollar, as against 6.8878 a dollar on Friday. 

 

However, intermittent purchases of dollars by major state-owned banks, a part of which was attributed to the Reserve Bank of India, kept the gains in the rupee in check, dealers said. Traders have refrained from placing large bets in favour of the Indian currency on the view that the central bank may continue its dollar-buying interventions to curtail sharp rise in the rupee, dealers said.

 

But, foreign fund inflows into Indian companies in the recent weeks have anchored the rupee in a range of 70.80 a dollar to 71.40 a dollar for most days this month.

 

Further, a sharp decline in domestic benchmark indices, Nifty 50 and Sensex, also weighed on the rupee, dealers said. 

 

Trade volumes were subdued today as financial markets in the US are shut on account of Martin Luther King Jr. Day.

 

A surge in  in early trade also weighed on the rupee.

 

On Sunday, Libya’s National Corp said members of the Petroleum Facilities Guard, under the command of Field Marshal Haftar’s Libyan National , shut down the Hamada-Zawiya pipeline, forcing it to curtail production at the Sharara and El Feel fields.

 

Iraq’s temporary closure of output at an oil field on Sunday, and reports that supply from another site could be at risk due to widespread protests, also boosted crude oil prices. At 1730 IST, Brent crude oil futures for March delivery traded at $65.33 per barrel compared with $64.88 per barrel on Friday. 

 

To cushion the sharp fall in the rupee, some major state-owned banks and private banks were said to have sold dollars around 71.14 a dollar, likely for exporters, dealers said. 

 

The rupee was at 71.10 a dollar at 1700 IST. For about two hours prior to this, the Indian unit moved in a range of 4-5 paise.

 

1700 IST

0900 IST

HIGH

LOW  

PREVIOUS
(AT 1700 IST)

71.1000

71.0950

71.0300

71.1500 71.0800

 

FORWARDS MARKET

Premiums on the one-year dollar/rupee forwards contract fell today because banks executed buy/sell swaps–buying dollars for immediate delivery and selling for forward delivery later–noting the fall in the Indian unit, dealers said.

 

In the absence of significant triggers, trade volumes remained lower than usual in the forwards segment today, dealers said. 

 

On an annualised basis, the premium on the one-year exact-period dollar/rupee contract was at 4.24% compared with 4.25% on Friday. The one-year month-end dollar/rupee contract was at 282.00 paise, from 284.50 paise at the previous close.

 

FUTURES MARKET

The one-month dollar/rupee futures contract for January ended steady as the Indian unit edged lower after erasing all gains against the greenback in the spot market.

 

 

January contract on NSE

 

Last dealt

Volume

Open interest

Today 71.1700 992,052 1,768,111
Previous 71.1400 1,356,926 1,784,774

 

OUTLOOK

The rupee may trade in a narrow range against the dollar on Tuesday in the absence of significant triggers, dealers said. Market players are expected to refrain from placing short bets on the US unit due to strong resistance posed by the RBI around 71.00-a-dollar mark, dealers said.

 

The rupee is also likely to track movement in crude oil prices, dealers said.

 

During the day, the dollar/rupee currency pair may move in a range of 71.00-71.30 a dollar.


India Rupee: Premiums down as spot rupee falls, trade volumes low

 

 

AT 1625 IST

 OPEN 

HIGH

LOW

PREVIOUS (AT 1700 IST)

Spot rupee per $1

71.1350 

71.0950 

71.0300 71.1500

71.0800

1-year fwd premium
(exact period)

4.24%

4.26%

4.28%

4.22%

4.25%

 

MUMBAI–1625 IST–Premiums on the one-year dollar/rupee forwards contract were lower today because banks executed buy/sell swaps–buying dollars for immediate delivery and selling for forward delivery later–noting the fall in the Indian unit, dealers said.

 

On an annualised basis, the premium on the one-year exact-period dollar/rupee contract was at 4.24%, compared with 4.25% on Friday. At 1625 IST, the one-year month-end dollar/rupee contract was at 282.00 paise, from 284.50 paise at the previous close.

 

In the absence of significant triggers, trade volumes remained lower than usual in forwards segment today, dealers said. Financial markets in the US are shut today on account of Martin Luther King Jr. Day.

 

For the rest of the day, the premium on the one-year exact-period dollar/rupee forwards contract is seen in a range of 4.20-4.25%.  (Mimansa Verma)


India Rupee – World FX: Pound sterling dn on UK chancellor’s comments

 

  AT 1625 IST HIGH LOW PREVIOUS
GBP/USD  1.2986 1.3015 1.2962 1.3016
EUR/USD  1.1087 1.1102 1.1083 1.1089
NZD/USD  0.6600 0.6624 0.6603 0.6603
AUD/USD  0.6864 0.6889 0.6863 0.6873
USD/JPY  110.1720 110.2140 110.0650 110.0870
USD/CAD  1.3069 1.3072 1.3055 1.3067
EUR/JPY  122.1300 122.3229 122.0950 122.1541
CHF/USD  1.0318 1.0340 1.0319 1.0325
EUR/CHF  1.0742 1.0751 1.0734 1.0729

 

 

MUMBAI-–1625 IST–The pound sterling was under pressure against the US dollar after UK Chancellor of the Exchequer Sajid Javid’s comments over the weekend that manufacturers in the county should adjust to new regulations because “there will be no alignment” with the European Union after Brexit.

 

Moreover, a slew of weak economic data in the UK last week led to concerns that Bank of might cut interest rates soon to support economic . Key policymakers in the country also hinted at a likely interest rate cut. 

 

The US dollar strengthened against major currencies in overnight trade following strong economic data from the US released late on Friday. US housing starts and permits rose 16.9% to an annual rate of 1.608 mln units last month, the most in about 13 years. 

 

The US Federal Reserve on Friday said manufacturing production rose 0.2% in December after a downward revision to 1.0% increase in November. This reduced the possibility of interest rate by the US Federal Reserve. 

 

Trade volumes globally remained thin as US markets are closed today on account of Martin Luther King Jr. Day. (Akansha Victor)


India Rupee: Down as banks cut short dollar bet, resistance at 71.03/$1 holds

 

  At 1535 IST 0900 IST HIGH  LOW  

PREVIOUS

(at 1700 IST)

Spot rupee per $1 71.1350 71.0950 71.0300 71.1400 71.0800

 

MUMBAI—1535 IST–The rupee edged lower after erasing all gains against the US dollar because banks cut their bets in favour of the Indian currency after noting strong resistance around 71.03 a dollar, dealers said. 

 

Moreover, the rupee was said to have closely tracked Chinese yuan that retreated from its highest level in six months, hit earlier today. At 1530 IST the yuan was trading at 6.8653 a dollar compared 6.8588 on Friday. It had risen to high of 6.8399 a dollar earlier in the day. 

 

Two big state-owned banks and a mid-sized state-owned bank were said to have purchased the greenback. A few dealers speculated a portion of these dollar purchases to be on behalf of the Reserve Bank of India. 

 

“Rupee is closely tracking Chinese yuan, but in the morning Yuan appreciated significantly, however, rupee didn’t rise as much because PSU banks were seen protecting the lower level(dollar/rupee), so I think it could be RBI around 71.03 (per dollar),” a dealer with a state-owned bank said. 

 

The trade volumes were very thin today in the absence of significant cues, dealers said. A 1% decline in domestic benchmark stock indices also weighed on the sentiment for rupee, dealers said. 

 

However, a further fall in the rupee was cushioned by dollar sales by a large state-owned bank and a large-private bank, likely for exporters, dealers said.

 

For the rest of the day, the dollar/rupee currency pair is expected to move in a range of 71.00-71.20 a dollar. (Akansha Victor)


India Rupee – F&O: Dlr/rupee tad down as rupee recovers in spot mkt

 

  1215 IST 0900 IST HIGH LOW PREVIOUS(AT 1700 IST)
Spot dollar/rupee 71.0550 71.0950 71.1200 71.0300 71.0800
1-month futures on NSE 71.1150 71.1650 71.1900 71.0800 71.1450
1-month futures on BSE 71.1125 71.1100 71.1775 71.0825

71.1450

1-month futures on MSE 71.1075 71.1375 71.1650 71.0900

71.1425

 

MUMBAI–1215 IST–The one-month dollar/rupee January futures contract was marginally lower as the Indian unit rose, recovering initial losses, against the dollar in the spot market.

 

Open interest in the January contract fell 1.62%.

 

JANUARY FUTURES
AT 1215 IST
NSE BSE   MSE
Volume 466,015 439,380 27,845
Open interest 1,806,260 2,964,814 37,629

(Akansha Victor)


India Rupee – NDF: Dollar/rupee down tracking weakness in US unit

 

MUMBAI – The dollar/rupee rate for one-month offshore non-deliverable forwards was lower today as the rupee rose marginally against the US dollar in the onshore market, recovering its earlier losses. 

 

At 1155 IST, the one-month dollar/rupee offshore contract was at 71.22, compared with 71.28 late on Friday. In the onshore market, the one-month dollar/rupee rate was at 71.10 a dollar. The dollar index was at 97.59, against 97.64 on Friday. 

 

Trade volumes across the globe were muted today as the US markets were closed for Martin Luther King Jr Memorial Day.

 

In the domestic spot market, the Indian currency rose tracking strength in the Chinese yuan because the People’s Bank of China set the central parity rate at 6.8664 a dollar, as against 6.8878 a dollar on Friday. The parity rate set by the central bank was the strongest in six months.  (Akansha Victor)


India Rupee – Asia FX: Yuan up, central bk’s parity rate at 6-mo high

 

MUMBAI – Most Asian currencies traded with a positive bias against the US dollar today, with the Chinese yuan rising the most after the People’s Bank of China set the central parity rate at 6.8664 a dollar, the strongest in six months, against 6.8878 a dollar on Friday. 

 

While the Taiwan dollar, the Malaysian ringgit and the Thai baht remained largely unchanged, the South Korean won was higher against the US unit due to expectations that the country’s GDP may grow 0.7% on quarter in Oct-Dec, compared with 0.4% growth in the previous quarter.

 

The Indonesian rupiah was flat, as market participants turned cautious following President Joko Widodo’s comment on Thursday that a sharp rise in the rupiah might reduce export competitiveness of the country.  (Mimansa Verma)


India Rupee: Slightly up tracking yuan, rise in crude prices weighs

 

  At 1010 IST 0900 IST HIGH  LOW  

PREVIOUS

(at 1700 IST)

Spot rupee per $1 71.0500 71.0950 71.0400 71.1200 71.0800

 

MUMBAI–1010 IST–The rupee was marginally higher against the US dollar, tracking strength in the Chinese yuan and as exporters sold dollars, despite a rise in crude oil prices, dealers said. 

 

The yuan strengthened because the People’s Bank of Chine set the central parity rate at 6.8664 a dollar, as against 6.8878 a dollar on Friday. The central parity rate set by the central bank was the strongest in six months.  

 

“Trade volumes are thin today, the market is waiting for fresh cues and some clarity on the direction of the market,” a dealer with a big state-owned bank said. 

 

A rise in Brent crude oil prices weighed on the Indian currency. Brent crude oil prices rose nearly 1% in Asian trade today. On Sunday, National Oil Corp said the Hamada-Zawiya oil pipeline in southwest Libya began shutting down on orders from Field Marshal Haftar’s Libyan National Army.

 

Supply from the Sharara and El Feel oilfields have been affected by the move. 

 

Market participants expect dollar sales by exporters throughout the day to support the rupee, dealers said. A large private bank and two US-based banks were among major sellers of the greenback, dealers said. 

 

However, dollar purchases by some state-owned banks limited gains in the rupee, dealer said. A large state-owned bank and a big state-owned bank were said to have bought dollars. 

 

For the rest of the day, the dollar/rupee currency pair is expected to move in a range of 70.95-71.15 a dollar. (Akansha Victor)


India Rupee: Technical Levels for rupee – Jan 20

 

MUMBAI – At 0900 IST, the rupee was at 71.0950 a dollar, as compared to 71.0800 at 1700 IST on Friday. At 0920 IST, the rupee was at 71.1075 per dollar.

 

Following are key support and resistance levels for the rupee as predicted by leading banks and brokerages:

 

  S1 S2 R1 R2
Big state-owned bank  71.20 71.32 71.00 70.98
Big state-owned bank  71.20 71.26 71.00 70.93
State-owned bank 71.14 71.22 70.94 70.80
State-owned bank 71.25 71.00
Private bank 71.15 71.20 71.00 70.95

(Akansha Victor)


India Rupee: Expected range for rupee – Jan 20

 

MUMBAI – Following are expected support and resistance levels for the rupee, as by leading banks and brokerages in a Cogencis poll:

 

  SUPPORT RESISTANCE
Big state-owned bank 71.26 70.93
State-owned bank 71.20 70.90
Private bank 71.20 70.90
Private bank 71.25 70.90

(Akansha Victor)

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Mainak Moitra

 

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This copy was first published on the Cogencis WorkStation

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Source: Cogencis

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