ICICI Direct expects USD to find supports at lower levels. Utilise down sides in the pair to go long on the USDINR pair.
ICICI Direct's currency report on USDINRDebt market
Government bonds fell a s investors defer purchases ahead of the Monetary Policy Committee’s interest rate decision due today. Although the consensus is for no change in interest rates, the liquidity stance would provide clues as the banking system remain s awash with liquidity • The benchmark 6.97 % 202 6 bond yield remain unchanged at 6.65 % in the previous session • Yield on the US 10 - y ear fell to 2. 3 4 % from 2. 3 6 % in the previous sessionForex (US$/INR)
The rupee rose against the dollar, as foreign banks sold the US$, helping erase losses caused by caution ahead of the domestic monetary policy decision today. Traders would be awaiting the RBI ’s stance on excess liquidity in the system • The US dollar was almost unchanged against major currencies post US Fed minutes. Officials have toned down the stance for a gradual reduction in Fed balance sheet against an abrupt halt. The apanese Yen gained post Fed minutes . We expect the pair to see some further selling as the pair remains highly immune to the US rate hike trajectoryUS$/INR derivatives strategyIn the currency futures market, the most traded dollar - rupee April contract on the NSE ended at 65.08. The April contract open interest fell 7.04 % from the previous day • May contract open interest rose 13.96 % from the previous day • We expect the US$ to find supports at lower levels. Utilise down sides in the pair to go long on the US$INR pair.
|US$INR April futures contract (NSE)||View: Bullish on US$INR|
|Buy US$INR in the range of 65.05 - 65.15||Market Lot: US$1000|
|Target: 65.35 / 65.55||Stop Loss: 64.98|
|S1/ S2: 65.05 / 64.90||R1/R2:65.33 /65.50|
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