According to Angel Broking, Rupee is likely to trade sideways as recent weakness seen in the DX will prompt the traders to place fresh bets which in turn will keep the rupee pressurized. However,
Angel Broking's report on Currencies
US DOLLAR INDEX (USD)
The American currency plunged by - 1.4 percent in the last week. Reason for the same could be attributed to the dovish stance in the FOMC meeti ng minutes which prompted the traders to book profits. Members of the FOMC committee were divided over when the next rate rise should come. As per federal funds future rates, only 12 percent traders saw a chance of rate hike in Sep'16 from 24 percent. On t he flip side the New York Fed President William Dudley spoke about the improving labour market thereby hinting that the US Federal Reserve might raise rates in its Sep’16 monetary policy review. Traders were so focused on this event that they even ignored the robust release of economic data sets from the nation like industrial production, unemployment claims, and housing starts data except for the inflation data which came below the forecasted levels.
Rupee is likely to trade sideways as recent weakness seen in the DX will prompt the traders to place fresh bets which in turn will keep the rupee pressurized. However, markets are expected to cheer the appointment of Urjit Patel as the new RBI Governor as he bei ng the existing deputy governor is abreast of the economic matters in the country and will keep continuity in policy.
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First Published on Aug 22, 2016 10:21 am