Market Highlights & Commentary:
- INR opens marginally strong at 71.79 as against last week close of 71.90 and may trade the day between 71.74 to 72.23 under mixed manner. Ahead of Fed monetary meeting on 19th, INR and other emerging currencies are likely to remain under pressure. Today if INR closes below 72 levels, possibility of 72.50-72.72 will increases.
- This week market will firmly focus its attention on monetary policy meeting’s major central banks including Fed, BOJ, BOE will hold its momentary policy meeting. Hence market is expected to see heighten volatility. While Fed is widely been anticipated to 25 bps rate hike, soft inflation and poor jobs data may force Fed to even maintain status quo.
- Last Friday India’s trade deficit was released which was in line with market expectation narrowing down to USD 16.6 Bn in Nov’18 from previous USD 17.1 in Oct’18. The marginal fall was on the back of fall in oil price. We are of the view that if oil price continues to hold around 60 levels, India’s trade deficit is likely to fall by another USD 3-4 Bn.
- This morning currency market are flat ahead of Fed meeting while equities are trading weaker. CNY holding around 6.90 against USD.
Technical Corner & strategy for the day:
- USDINR last Friday tried breaking above 72 levels, if today price finds success closing above these crucial levels. We may see 72.50-72.73 levels in this week.
- Exporter for the day may target 72+ levels around 72.10-72.15 while importer around 72.80-72.84 for the day.
- GBPINR currently around 90.48 levels and currently is trading under consolidation pattern, we may get better picture once price breaks out of the symmetrical consolidation. For the day GBPINR likely to be mixed between 90.25/30-90.50/60.
- EURINR has been trading under bearish trend, but seems to have found support around 81.12-81.20 levels indicating possibility of reversal towards 81.50-81.55. In the day if price closes above 81.50, we may see EURINR trading above 81.90 in coming days.
Important Economic Data and Events (17.12.2018 to 21.12.2018):
- December 19: FOMC meeting
- December 20: Bank of Japan monetary policy meeting
- December 20: Bank of England monetary policy meeting
Fridays Market Recap:
- Last week INR closed with fresh low at 71.89 after trading flat around 71.72 for major part of the day amid of RBI meeting buy later lost ground and closed weaker at 71.89. Other major currencies too ended the day flat with no major change from the opening.
- The benchmark NSE to remains cautioned with no major change around 10,805 levels.