Rupee Wrap - Dec 29, 2021 - Reliance Securities

Mr. Sriram Iyer, Senior Research Analyst at Reliance Securities

The Indian Rupee depreciated against the U.S. Dollar on Wednesday tracking losses in most Asian peers and on worries over constantly rising oil prices.

The Rupee ended at 74.74 against the dollar as compared with 74.65 close in the previous session.

The local unit was weighed down by weak data. India's trade deficit in November widened the most on record to stand at $22.91 billion, as the on-year growth in merchandise imports outpaced that of exports.

Meanwhile, most other Asian shares and currencies were weak this Wednesday and weighed on the local unit.

Moreover, elevated crude oil prices, FPI outflows and hawkish U.S. central bank also kept the currency from appreciating further.

NDF is at 74.75/77 this Wednesday morning vs a close at 74.67 in the previous session.

Indian bond yields eased this Wednesday with the benchmark 6.10% bond ending at 6.46%, compared with a 6.48% close in the previous session.

Technically, the USDINR Spot pair has bounced back from its 100-Daily Moving Average which is placed at 74.58 level and above the level could push the pair to 74.95-75.00 levels. Support is at 74.60-74.40 levels.

The U.S. Dollar was flat to marginally higher this Wednesday afternoon trade in Asia as investors looked past surging cases of Omicron in another spell of improved risk appetite.

However, holiday-thinned trading will keep the index in a small range.

Technically, if the Dollar Index Dollar Index remains above 21-Daily Moving Average, it could continue its bullish momentum up to $96.55-$96.90 levels. Support is at $96.20-$96.00 levels.

The Euro, the Sterling and the safe haven Yen were weaker this Wednesday afternoon trade.

Source : Equity Bulls

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