Rupee Wrap - March 9, 2022 - Reliance Securities

Mr. Sriram Iyer, Senior Research Analyst at Reliance Securities

The Indian Rupee appreciated against the U.S. Dollar for a 2nd straight session on broad dollar declines and as local equities extended yesterday's rebound.

Talks of supported by exporters hedging positions and RBI's presence in the market also supported the strength in this Wednesday's session.

The Rupee ended at 76.56 appreciating by 0.4% compared with 76.91 close yesterday.

Meanwhile, tensions also eased in Eastern Europe after media reports showed that Ukraine President Volodymyr Zelensky said that Ukraine is no longer pressing for NATO membership and it is also open to a compromise on the status of two breakaway pro-Russian territories that President Vladimir Putin had recognized as independent.

Regional currencies were also appreciated this Wednesday, while regional and European equities were stronger furthermore, crude oil prices pulled back despite U.S. ban of Russian imports of energy products and lent support.

NDF is at 76.58/59 this Wednesday evening vs a close at 76.87 on Tuesday.

Indian bond yields ended lower amid speculation that Russia-Ukraine geopolitical tensions would likely ease soon, while crude oil prices eased a little and helped in the fall in yields.

The benchmark 6.54% bond ended at 6.84%, against of 6.89% close yesterday.

Technically, if the USDINR spot pair continues to trade below 76.65 levels, it could continue its downside momentum up to the support zone at 76.22-76.00. A trade above could push the pair back to the resistance zone at 76.80-76.95.

The USDINR Spot pair could trade in a range of 76.22-76.80 levels in the coming session.

The U.S. Dollar is trading weaker this Wednesday evening in Asian trade.

The Euro rose against the dollar this Wednesday evening in Asian trade lifted by expectations that the euro zone will increase fiscal spending to help offset the economic effects of Russia's invasion of Ukraine an investors were hesitant to sell the euro ahead of a European Central Bank policy meeting on Thursday.

Investors will also look cues from the U.S. CPI number on Thursday.

Technically, if Dollar Index trades below $98.50 levels, it could witness a downside momentum up to the support zone at $98.00-$97.95. A trade above could push the Index back to the resistance zone at $98.80-$99.00.

Source : Equity Bulls

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