Currencies World 27-05-2014 …

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MCX-SX USDINR May 2014

Rupee retreated from an 11-month high to fall as the central bank stepped in to temper gains being sparked by continued expectations of robust foreign inflows and a rally in domesticshares. The currency still rose 0.4 percent for the week, posting its fourth straight weekly gain and its longest winning streak in 16 months on hopes the Bharatiya Janata Party’s landslidewin last week would bring a new government willing to undertake substantial economic reforms. The Reserve Bank of India was spotted buying dollars through state-run banks after the rupee hit its session high, and continued intervention is likely to cap gains in the rupee.

Gains were helped after the benchmark BSE share index rose more than 1 percent on Friday to become the best performing equity market in Asia-Pacific for 2014 in dollar terms. Investors are expected to focus on the introduction of the new government, with Narendra Modi expected to be sworn in on Monday, unveiling his cabinet appointments soon after. The partially convertible rupee closed at 58.52/53 per dollar, after gaining as high as 58.33 intraday, its strongest against the dollar since June 18.

In the offshore non-deliverable forwards, the one-month contract was at 58.72, while the three-month was at 59.30.Technically market is under long liquidation as market has witnessed drop in open interest by -2.34% to settled at 230901 while prices down -0.0275 rupee, now USDINR is getting support at 58.2075 and below same could see a test of 58.14 level, And resistance is now likely to be seen at 58.4675, a move above could see prices testing 58.66.

MCX-SX EURINR May 2014

Euro edged down as Thursday’s euro zone data continued to weigh on demand for the single currency, while positive reports from the U.S. lent support to the greenback. Germany’s private sector continued to grow strongly this month but the French private sector fell back into contraction territory. Germany’s economic growth rebounded as previously estimated in the first quarter driven by domestic demand, the detailed report from Destatis showed. Gross domestic product grew 0.8 percent sequentially in the first quarter, up from 0.4 percent in the fourth quarter. The quarterly rate came in line with the provisional estimate published on May 15.

On a calendar-adjusted basis, GDP grew 2.3 percent year-on-year, faster than the 1.4 percent rise seen in the fourth quarter. This was the largest increase in over two years. Gross fixed capital formation advanced at a faster pace of 3.2 percent o n the previous quarter. Household final consumption expenditure climbed 0.7 percent on the fourth quarter. At the same time, general government expenditure grew only 0.4 percent. The Eurozone private sector maintained growth momentum in May as new orders and output in services nullified the moderate weakness in manufacturing.

Technically market is under fresh selling as market has witnessed gain in open interest by 5.95% to settled at 14143 while prices down -0.305 rupee, now EURINR is getting support at 79.2475 and below same could see a test of 79.0825 level, And resistance is now likely to be seen at 79.765, a move above could see prices testing 80.1175.

MCX-SX GBPINR May 2014

GBP fell after solid U.S. home sales and manufacturing activity numbers sparked demand for the greenback due to sentiments the days of ultra-loose monetary policy in the U.S. are coming to an end. U.K. house prices continued to rise in May, as households expect the price of their property to rise at the strongest pace since early 2009, a combined survey by property consultancy Knight Frank and Markit Economics showed. The house price sentiment index climbed to new record high 63.2 in May from 62.7.

This was the fourteenth consecutive month of increase. The new high means that households are more confident that the price of their property is rising than at any other time since the index began in early 2009, the survey said. The U.K. economy grew at a faster pace as initially estimated in the first quarter, driven by consumer spending and business investment, suggesting that a more balanced recovery is on track, second estimates from the Office for National Statistics showed.

Gross domestic product grew 0.8 percent from the prior quarter, unchanged from the estimate published on April 29. The sequential growth follows a 0.7 percent rise in the fourth quarter of last year.

Technically market is under fresh selling as market has witnessed gain in open interest by 10.26% to settled at 12818 while prices down -0.255 rupee, now GBPINR is getting support at 98.15 and below same could see a test of 97.8675 level, And resistance is now likely to be seen at 98.7825, a move above could see prices testing 99.1325.

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