Monday, June 27, 2016
Currency Daily Report
Friday, July 29, 2016
CONTENTS
Market Overview
Daily Analysis with fundamental and technical outlook
US Dollar
Indian Rupee
Euro
Sterling Pound
Japanese Yen
Important events for the day
INR likely to trade lower on BoJ stimulus action
Euro to trade lower owing to important economic data releases
Pound to trade higher on robust GDP data from the nation
BoJ infuses stimulus in the market that will keep the JPY pressurized
For further assistance please refer to the full report
Monday, June 27, 2016
Currency Daily Report
Friday, July 29, 2016
MARKET HIGHLIGHTS (% change) as on 28-Jul-16
INDICES LAST CHANGE WOW MOM
NIFTY* 8666.3 0.59 1.8 5.6
SENSEX* 28208.6 0.66 1.8 5.5
DJIA 18456.4 -0.09 -0.3 2.9
S&P 2170.0 0.2 5.1 5.4
FTSE 6721.1 -0.4 -61.5 3.0
KOSPI 2021.1 -0.1 0.4 1.7
BOVESPA 58497.8 0.2 3.3 11.3
NIKKEI 16476.8 13.8 -0.1 5.2
Source: Reuters
COMMODITIY HIGHLIGHTS (% change) as on 28-Jul-16
INDICES LAST CHANGE WOW MOM
NYMEX CRUDE - $/BBL 41.14 -1.9 -8.1 -17.5
COMEX GOLD - $/OZ 1334.60 0.2 0.9 -0.2
COMEX SILVER - $/OZ 20.16 1.0 2.6 3.2
LME COPPER (3M) -$/TONNE 4896.50 1.0 -1.6 -18.1
Source: Reuters
CURRENCY HIGHLIGHTS (% change) as on 28-Jul-16
CURRENCY LAST CHANGE WOW MOM
DX 96.72 -0.3 -0.3 0.5
USDINR 67.00 0.1 0.2 0.6
EURUSD 1.1074 0.2 0.5 -0.4
GBPUSD 1.3163 -0.43 -0.5 -1.9
USDJPY 105.24 -0.14 -0.5 2.4
Source: Reuters
Technical Chart – USDINR
Source: Reuters
Daily INR= 25-05-2016 - 28-07-2016
Cndl, INR=, 26-07-2016, 67.4048, 67.4283, 67.3767, 67.4033,
+0.0010, (0.00%)
Price
66.6
66.9
67.2
67.5
67.8
68.1
67.4033
30 06 13 20 27 04 11 18 25May 16 June 2016 July 2016
MARKET OVERVIEW
Asian markets are trading on a negative note as investors play
safe prior to the BoJ Monetary Policy Meeting that is to be
scheduled during the day. Markets expect aggressive easing by
the BoJ so as to boost the Japanese economy.
US DOLLAR INDEX (USD)
The American currency plunged by 0.3 percent in yesterday’s
trading session as markets discounted the recent FOMC monetary
policy review. The Federal Reserve made a comment that the
labour market was finally getting back on track and near term
risks to the American economy had started to fade. However, the
inflation rate still lingered under the 2 percent target which
prompted the US policymakers to keep the interest rates on hold.
There was no major volatility in the DX since markets were not
expecting a rate hike this time but wanted clues as to when the
Feds would go for a rate hike in times of uncertainty like the post-
Brexit effects and the upcoming US Presidential elections.
The American currency made an intraday low of 96.25 and closed
at 96.72.
INDIAN RUPEE (USDINR)
The Indian rupee appreciated by 0.1 percent yesterday owing ot
weakness in the American currency after the US Fed kept the key
interest rates on hold. Moreover, month end dollar selling by
exporters and banks amid weaker dollar in the overseas markets
also helped the rupee to stand strong.
Domestic markets i.e. Sensex and Nifty traded higher as markets
discounted the news of BoJ infusing huge monetary stimulus
package which led to a big rally. Moreover, the state ministers
have agreed to implement the GST bill on the principle that the
tax rate will be lower than the current levels.
The Indian rupee made an intraday high 66.93 and closed at 67.00
levels on Thursday.
OUTLOOK
Rupee is likely to trade negative as markets indulge in speculation
prior to the BoJ monetary Policy review that is to be held anytime
during the day. Markets expect aggressive easing by the BoJ so as
to boost the Japanese economy. this will keep the Indian Rupee
pressurized.
Technical View valid for 29-Jul-16
Currency Futures Trend S1 S2 R1 R2
USDINR July’16 (NSE/MSE) Sideways 67.10 66.95 67.40 67.55
Monday, June 27, 2016
Currency Daily Report
Friday, July 29, 2016
EURO (EURUSD)
Euro currency traded higher by 0.2 percent in yesterday’s trading
session on account of robust release of economic datasets from
the nation. Inflation in Germany has climbed higher more than
the expected levels thereby infusing optimism over the strength
of the Euro-zone’s largest economy.
According to a recent report, money circulation in the euro-zone
economy has risen thereby indicating that there has been a surge
in lending.
Furthermore, US Dollar index weakened after the US Feds kept
the interest rates unchanged in the recent FOMC meeting which
provided some support to the shared currency.
Euro currency made an intraday high of 1.1118 and closed at
1.1074 levels on Thursday.
OUTLOOK
Euro is expected to trade lower owing to cautiousness in the
market prior to the important economic data releases from the
nation that is likely to keep the Euro currency volatile.
Technical View valid for 29-Jul-16
Currency Futures Trend S1 S2 R1 R2
EURINR July’16 (NSE/MSE) Sideways 73.77 73.62 74.07 74.22
STERLING POUND (GBPUSD)
Sterling Pound declined by 0.43 percent yesterday as recent
strength in the currency prompted the traders to book profits.
Moreover, lack of important economic data and events from the
nation kept the trading volumes light.
However, sharp losses were capped as markets discounted the
robust release of GDP data from the nation that came better than
the forecasted levels which was a surprise given Britain’s latest
exit from European Union.
The second lord of the Treasury, Chancellor Philip Hammond
stated that the recent GDP figures show that the fundamentals of
the British economy were strong in a period of adjustment
following the decision to leave the EU.
OUTLOOK
Sterling Pound is expected to trade lower as lack of important
economic data sets from the nation today will prompt the
investors to focus on the Aug’16 BoE Monetary Policy meeting.
Technical View valid for 29-Jul-16
Currency Futures Trend S1 S2 R1 R2
GBPINR July’16 (NSE/MSE) Sideways 88.04 87.86 88.35 88.51
Technical Chart – EURINR
Source: Reuters
German Prelim CPI surged by 0.3 percent in June’16 from
0.1 percent in May’16
Spanish Unemployment Rate declined to 20 percent in
June’16 from previous months 21.0 percent
Final CPI of the Euro-zone remained unchanged at 0.1
percent for the month of Jun’16
Technical Chart – GBP/INR
Source: Reuters
CPI came on a good note at 0.5 percent in June’16 from
0.3 percent in May’16
Retails sales declined by 0.9 percent in June ’16 from
previous months 0.9 percent.
Average Earnings Index surged by 2.3 percent in June’16
as against 2.0 percent in May’16
Unemployment Rate falls to 4.9 percent from 5 percent
Outlook for the UK banking sector was now ‘negative’
from ‘stable’ - Moody’s
Daily EURINR= 24-05-2016 - 27-07-2016
Cndl, EURINR=, 25-07-2016, 73.6500, 74.0800, 73.6400, 73.9700,
+0.3200, (+0.43%)
Price
73.5
74
74.5
75
75.5
76
76.5
73.9700
30 06 13 20 27 04 11 18 25May 16 June 2016 July 2016
Daily GBPINR=R 25-05-2016 - 28-07-2016
Cndl, GBPINR=R, 26-07-2016, 88.533, 88.600, 88.155, 88.346,
-0.221, (-0.25%)
Price
87
90
93
96
99
102
88.346
30 06 13 20 27 04 11 18 25May 16 June 2016 July 2016
Monday, June 27, 2016
Currency Daily Report
Friday, July 29, 2016
JAPANESE YEN (JPY/USD)
Japanese yen appreciated by 0.14 percent yesterday on account
of US Dollar weakness after the US Federal Reserve kept the key
interest rates unchanged in the recent FOMC Monetary policy
review.
Markets have indulged into increased speculation and
expectation of a huge monetary stimulus by the Bank of Japan
policymakers in its today’s monetary policy meeting. This has led
to volatile swings in Japanese Yen. According to a Bloomberg poll,
78 percent of analysts expect that the Bank of Japan will expand
easing this week. An expand in easing will most likely boost the
economy of Japan followed by a deeper cut in the negative
interest rate applied to a portion of the money that commercial
banks deposit at the BoJ.
OUTLOOK
Japanese yen is expected to trade negative as markets discount
the BoJ Monetary Policy review where the policymakers
increased their stimulus program and kept the key interest rates
unchanged.
Technical View valid for 29-Jul-16
Currency Futures Trend S1 S2 R1 R2
JPYINR July’16 (NSE/MSE) Sideways 63.51 63.35 63.82 63.98
Technical Chart – JPY/INR
Source: Reuters
Bank of Japan said it would buy ¥6 trillion worth of
exchange-traded funds annually, up from ¥3.3 trillion
previously, in an attempt to stoke inflation and
economic growth.
It said it would leave its asset-purchase target at ¥80
trillion a year. The central bank also left a key interest
rate on bank reserves unchanged at minus 0.1%.
Daily JPYINR=R 23-05-2016 - 28-07-2016
Cndl, JPYINR=R, 26-07-2016, 63.6952, 64.4225, 63.6411, 64.2671,
+0.5658, (+0.89%)
Price
60
61
62
63
64
65
66
67
68
64.2671
23 30 06 13 20 27 04 11 18 25May 2016 June 2016 July 2016
Economic indicators to be released on 29-Jul-16
Indicator Country Time (IST) Actual Forecast Previous Impact
Household Spending y/y Japan 5:00am - -0.4% -1.1% Medium
Tokyo Core CPI y/y Japan 5:00am - -0.4% -0.5% Medium
Retail Sales y/y Japan 5:20am - -1.2% -2.1% Medium
Monetary Policy Statement Japan Tentative - - - High
BOJ Outlook Report Japan 10:30am - - - High
German Retail Sales m/m Euro 11:30am - 0.0% 0.9% Medium
BOJ Press Conference Japan Tentative - - - High
Spanish Flash CPI y/y Euro 12:30pm - -0.5% -0.8% Medium
Spanish Flash GDP q/q Euro 12:30pm - 0.7% 0.8% Medium
Net Lending to Individuals m/m UK 2:00pm - 4.2B 4.3B Medium
CPI Flash Estimate y/y Euro 2:30pm - 0.1% 0.1% Medium
Core CPI Flash Estimate y/y Euro 2:30pm - 0.9% 0.9% Medium
Prelim Flash GDP q/q Euro 2:30pm - 0.3% 0.6% Medium
Advance GDP q/q US 6:00pm - 2.6% 1.1% High
Advance GDP Price Index q/q US 6:00pm - 1.9% 0.4% Medium
Employment Cost Index q/q US 6:00pm - 0.6% 0.6% Medium
Chicago PMI US 7:15pm - 54.3 56.8 Medium
Revised UoM Consumer Sentiment US 7:30pm - 90.2 89.5 Medium
Monday, June 27, 2016
Currency Daily Report
Friday, July 29, 2016
Research Team
Heena Imtiaz Naik
Research Associate
Currency
(022) 2921 2000 Extn :6104
Prathamesh Mallya
Sr. Research Analyst
Non-agro Commodity & Currency
(022) 3935 8134 Extn :6134
Harsh Rawat
Technical Analyst
Currency
(022) 3935 8141
Kaynat Chainwala
Research Analyst
(022) 3935 8136 Extn :6136
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