FX Monitor - April 20, 2020 - Geojit

- Indian currency ended at 76.40 on Friday, up 47 paise against its previous close of 76.87.
- FBIL set the reference rate for USDINR at 76.5444 and Euro at 83.0542.
- US dollar traded cautiously as the investors drifted away from safe haven assets.
- Tomorrow, US to release its retail sales for March.
- Euro was unchanged while UK's pound to take cues from government's consideration to lift lockdown.
- On the data side, Japan's trade surplus for March fell below estimates.
- PBOC today gave an update of its Loan Prime Rate; lowered benchmark interest by 20bps to a record low.

Outlook - USDINR

Positive sentiments lifted by the RBI's endorsement aided the domestic currency that reversed its previous day's all time low to close higher by 47 paise on Friday. Volatile oil prices and tracking the gains in the Indian equities also supported the forex markets. On the last day of the trading week, the local unit opened at 76.56 a dollar and moved in a range of 76.35 and 76.63 before ending the session at 76.40 against its previous close of 76.87. On week on week basis, Rupee lost 12 paise.

RBI stepped in again to protect the economy from the recent crisis by announcing a slew of measure, which included reducing its reverse repo rate by 25 bps from 4% to 3.75%. The central bank of India also said to conduct "TLTRO 2.0" for an aggregate amount of Rs 50,000cr to take care of liquidity issues. FIIs were sellers in the capital market segment; sold shares worth Rs 1391.98cr on 17 Apr. In other news, US crude oil ended the week at its lowest level since Jan 2002 and today crashed to a level not seen since March 1999.

For USDINR, 76.80 may act as a crucial level in the upside while 76.18 and 75.85 will act as major support levels.

Source : Equity Bulls

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