Currencies World 10-04-2014 …

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MCX-SX USDINR Apr 2014

Rupee ended a touch weaker despite domestic shares hitting record highs as caution prevailed ahead of the release of minutes from the U.S. Federal Reserve’s March meeting. Foreign investors have been active buyers of debt and equities since March, and net purchases in April alone have already totalled $933.67 million, according to the market regulator’s data.

The rupee had touched an eight-month high of 59.5950 on April 2, before giving up some gains, with the Reserve Bank of India also suspected of having bought dollars to replenish its foreign exchange reserves.However, gains were capped ahead of the Fed’s minutes given continued concerns about when the central bank will start to raise interest rates as it unwinds its asset purchase programme.

The partially convertible rupee closed at 60.14/15 per dollar compared with 60.11/12 on Monday. In the offshore non-deliverable forwards, the one-month contract was at 60.62, while the three-month was at 61.37. The country’s forex reserves rose to $303.67 billion as of March 28 from $298.64 billion in the previous week, the RBI said, the highest since the week ended November 29, 2013, according to data.

Technically market is under fresh selling as market has witnessed gain in open interest by 12.22% to settled at 214326 while prices down -0.0275 rupee, now USDINR is getting support at 60.31 and below same could see a test of 60.04 level, And resistance is now likely to be seen at 60.67, a move above could see prices testing 60.76.

MCX-SX EURINR Apr 2014

Euro gained on expectations that the European Central bank would ease its monetary policy and add to its stimulus measures amid caution ahead of the release of the US Federal Reserve Open Market Committee minutes of meeting. Germany’s exports declined more than expected in February, but imports continued to rise for the second consecutive month, official data revealed. Exports fell 1.3 percent in February from January, which was the second fall in three months, Destatis said.

Exports were forecast to fall 0.5 percent after expanding 2.2 percent in January. At the same time, imports gained 0.4 percent month-on-month, faster than the expected 0.1 percent growth. However, the rate slowed from the 4.1 percent increase seen in January. The dollar remained under pressure ahead of the minutes of Fed’s March meeting due out later in the trading day, after last week’s U.S. payrolls report came in slightly below expectations.

Recent comments by senior ECB officials indicated that there is no urgent need for quantitative easing to stave off the threat of deflation in the region. One striking trend since last week is the euro’s resilience in the face of signals from the ECB that it is prepared to consider outright money printing to support growth if need be.

Technically market is under short covering as market has witnessed drop in open interest by -7.16% to settled at 12808 while prices up 0.365 rupee, now EURINR is getting support at 82.9925 and below same could see a test of 82.68 level, And resistance is now likely to be seen at 83.5125, a move above could see prices testing 83.72.

MCX-SX GBPINR Apr 2014

GBP was steadied close to highs after data showed that the U.K. trade deficit narrowed more-than-expected in February. Shop prices in the United Kingdom tumbled 1.7 percent on year inMarch, the British Retail Consortium said on Wednesday – posting the sharpest decline in seven years. The headline figure was shy of forecasts for a contraction of 1.5 percent following the1.4 percent fall in February. Among the individual components, clothing prices were a key drag – plummeting 12.8 percent. Electrical goods prices also fell 4.4 percent.

The U.K. visible tradedeficit narrowed in February, while the surplus on services declined from the prior month, data from Office for National Statistics showed. The deficit on trade in goods fell to GBP 9.1 billionin February from GBP 9.5 billion in January. The shortfall was expected to decline to GBP 9.2 billion.

Exports of goods slipped 1.6 percent from January to GBP 23.5 billion. Similarly, imports dropped 2.2 percent to GBP 32.6 billion. Meanwhile, the surplus on services totaled GBP 7 billion compared to January’s GBP 7.3 billion surplus. The pound received an additional boost afterupbeat U.K. industrial production data bolstered the outlook for the wider recovery and fuelled expectations that BOE may raise interest rates sooner.

Technically market is under fresh buying as market has witnessed gain in open interest by 13.64% to settled at 11458 while prices up 0.9175 rupee, now GBPINR is getting support at 100.775 and below same could see atest of 100.405 level, And resistance is now likely to be seen at 101.37, a move above could see prices testing 101.595.

MCX-SX JPYINR Apr 2014

JPY gained after Bank of Japan refrained from cutting interest rates and on increased appetite after the IMF projected US growth to pick up. The Bank of Japan kept its current monetarystimulus unchanged as it projects upbeat economic outlook even though the first sales tax hike since 1997 is set to oscillate consumer spending.

The Policy Board, governed by HaruhikoKuroda, unanimously decided to continue to expand the monetary base at an annual pace of about JPY 60-JPY 70 trillion. The annual pace of purchase of government bonds will remain at about JPY 50 trillion. The central bank launched its large stimulus April last year, when it vowed to end deflation and shore up consumer price inflation to 2 percent in two years time horizon.

The BoJ left its economic assessment unchanged from last month. Japan’s economy has continued to recover moderately as a trend, albeit with some fluctuations due to the consumption tax hike, the bank said in a statement. The current conditions index rose to 57.9 in March from 53 in February, the Economy Watchers Survey from the Cabinet Office said. Japan posted a current account surplus of 612.7 billion yen in February, the Ministry of Finance said – turning positive after four straight months of deficit.

Technically market is under fresh buying as market has witnessed gain in open interest by 10.5% to settled at 4105 while prices up 0.6725 rupee, now JPYINR is getting support at 59.085 and below same could see a test of 58.815 level, And resistance is now likely to be seen at 59.47, a move above could see prices testing 59.585.

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