Rupee Wrap - April 11, 2022 - Reliance Securities

Mr. Sriram Iyer, Senior Research Analyst at Reliance Securities

The Indian Rupee appreciated against the U.S. Dollar on Tuesday supported by data showing offshore funds returning into domestic equities.

The Rupee ended at 75.32 on Tuesday, the strongest close since February 25, and compared with 75.54 close on Monday.

Foreign investors have bought a net $418 million of local markets so far this month, according to data from the NSDL.

Asian and EM peers were broadly weaker and capped appreciation bias while the markets also shrugged off strong crude oil prices in the afternoon session.

Indian government bond yields ended flat as market participants awaited fresh triggers.

The benchmark 6.54% settled at 6.90%, unchanged against yesterday's close.

The U.S. Dollar Index surged higher against the basket of currencies on Tuesday, boosted by hawkish comments from Federal Reserve officials who pushed for a quick reduction in the central bank's balance sheet, with one of them expressing openness to a 50-bps rate increase.

The Euro, the Sterling and the Yen tumbled against the dollar on Tuesday.

Most of the EM and Asian peers fell against the dollar on Tuesday.

The Indian Rupee is expected to weaken against the U.S. currency tracking the overnight gains of the dollar as hawkish comments from Fed policymakers lifted the greenback.

The Rupee could open at around 75.79-75.80 compared with 75.91 in the previous session.

Asian and EM peers were weaker against the U.S. Dollar this Wednesday morning and will weigh on sentiments.

NDF is at 75.44/46 this Wednesday morning vs a close at 75.35 on Tuesday.

Investors will await cues from RBI's and FOMC monetary policy meeting minutes today.

Technically, the USDINR Spot pair could trade in broad range of 75.55 to 75.20 in this Wednesday's session.

The U.S. Dollar has started higher this early Wednesday morning in Asian trade lifted by hawkish comments from the Fed policymakers.

The Euro struggled against the greenback this early Wednesday morning in Asian trade amid prospects of new Western sanctions on Russia.

Investors will look to cues from the FOMC monetary policy meeting minutes.

Technically, the Dollar Index could trade in a broad range of $99.00-$99.70.

Source : Equity Bulls

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