ICICI Direct expects USD to meet supply pressure at higher levels. Utilise upside in the pair to go short on the USDINR.
ICICI Direct's currency report on USDINRDebt market
Government bon ds were little changed, as investors consolidated positions ahead of the release of September inflation data today • The GoI benchmark 6.79 % 2027 bond yield was steady at 6. 74 % in the previous session • Yield on the US 10 - year yield declined to 2.35% from 2.36 % in the previous session.Forex (US$/INR)
The rupee rose for a third straight day. The US$ weakened after US President Donald Trump’s twitter clash with a fellow Republican Senator over the government’s tax overhaul plans • The US$ extended losses against major currencies post Fed’s monetary policy meeting minutes . The Fed raised concerns on inflation growth although a December interest rate hike remain intact. This led to profit booking in US$ and raised concerns on the future pace of Fed rate hikes. Euro jumped to 1.19 level on a weaker US$ and waning fears of Catalonia region’s independence.
In the currency futures market, the near month dollar - rupee October contract on the NSE ended at 65.29. The October contract open interest declined 14.50 % from the previous day • November contract open interest increased 12.62 % in the previous session • We expect the US$ to meet supply pressure at higher levels. Utilise upside in the pair to go short on the US$INR.
|US$INR October futures contract (NSE)||View: Bearish on US$INR|
|Sell US$INR in the range of 65.34 -65.42||Market Lot: US$1000|
|Target: 65.15 / 65.10||Stop Loss: 65.55|
|S1/ S2: 65.25 / 65.05||R1/R2:65.35 /65.55|
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