FX Monitor - May 5, 2020 - Geojit

- Indian currency ended at 75.73 yesterday, down 64 paise against its previous close of 75.09.
- FBIL set the reference rate for USDINR at 75.1150 and Euro at 81.6170.
- Domestic manufacturing PMI for Apr stood at 27.4 against 51.8 in March.
- US dollar edged higher on the possibility of American-Sino trade war.
- In economic news, US services PMI and trade balance figures to be released in the later part of the day.
- Euro fell while UK's pound traded lower against US dollar.
- BoE is set to release its monetary policy decision on Thursday.
- Japan market to be on holiday today owing to Childern's Day holiday.
- China market will be shut today on account of Labour Day holiday

USDINR Outlook

Indian currency snapped its four-day winning streak tracking the weakness in domestic equity and capital outflows. Strengthening of American currency also dampened the currency move. Local unit yesterday opened lower at 75.70 and moved in the range of 75.65 and 75.80 before settling the day at 75.73 against Thursday's closing of 75.09. On Friday, Indian markets were closed on the back of Maharashtra day.

FIIs were sellers in the capital market segment on 04 May; sold shares worth Rs 1373.98cr as per exchange's provisional figures. DIIs, on the other end were sellers to the tune of Rs 1661.61cr for the same period. On the data front domestic manufacturing PMI (Apr) released yesterday fell well below its 50-mark; stood at 27.4 in Apr against 51.8 in March amid lockdown concerns. Oil prices rebounded as more countries easing lockdowns and on the expected production cuts from largest oil producers. Apart from Covid-19 developments, macroeconomic figures and central bank meeting will be in focus.

For USDINR, 75.94 and 76.32 may act as a crucial level in the upside while 75.61 and 74.34 will act as major support levels.

Source : Equity Bulls

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