Views on Rupee - Feb 22, 2022 - Reliance Securities

Mr. Sriram Iyer, Senior Research Analyst at Reliance Securities

The Indian Rupee appreciated against the U.S. Dollar for the 4th session in amid dollar sales on optimism about a resolution to the Ukraine issue and in anticipation of inflows.

The Rupee ended at 74.51 compared with 74.66 on Friday.

The local unit hit an intraday high 74.35 during the day.

Meanwhile, the Asian currencies appreciated against the U.S. Dollar after the U.S. and Russia had agreed in principle to hold a summit to discuss security and strategic stability in Europe.

Additionally, foreign banks were on the selling side for the pair, as they may have been receiving inflows ahead of the initial share sale plan of the nation's largest insurer, LIC.

Indian government bond yields ended higher on Monday. The benchmark 6.54% bond ended 6.69%, versus 6.66% on Friday.

U.S. markets were closed on Monday for the Presidents Day holiday.

The Euro's fell from the highs of the session against the dollar on Monday after the Kremlin said there were no concrete plans for a summit over Ukraine between the Russian and U.S. presidents.

The Yen gained against the Dollar on Monday amid safe haven appeal for the currency.

The Indian Rupee could open weak against the U.S. Dollar this Tuesday amid weak risk appetite as tensions escalated in Eastern Europe.

Crude oil prices surged higher this Tuesday morning, while most of the Asian and EM peers were weaker against the U.S. Dollar as Ukraine crisis could escalate further.

The Rupee is expected at around 74.65/70 in opening trades compared with 74.51 on Monday.

NDF is at 74.60/69 this Tuesday morning vs a close at 74.53 in the previous session.

Technically, the USDINR Spot pair has given a breakdown below 50-Daily Moving Average at 74.74 levels and sustained trade below continue to pull the pair up to the support zone at 74.40-74.22 levels. Resistance zone is at 74.85-75.00 levels.

The USDINR Spot pair could trade in a range of 74.40-74.85 levels in this Monday's session.

The U.S. Dollar started flat to higher this early Tuesday morning in Asian trade amid safe haven appeal for the greenback as Russia ordered troops into breakaway parts of eastern Ukraine and the region stood on the brink of war.

Non-dollar currencies remained under pressure early Tuesday morning.

Technically, if Dollar Index continues to trade above $95.95 level, it could continue its bullish momentum up to the resistance zone at $96.25-$96.45. However, a trade below could pull the Index back to the support zone at $95.75-$95.45.

Source : Equity Bulls

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