USDINR
On Thursday, We are expecting USDINR commence session with gap up between 73.50 – 73.60 as greenback rally to its highest level in almost two months after the Federal Reserve brought forward its projections for the first interest rate hikes into 2023. The projections of when central-bank officials envision lifting their benchmark overnight rate from near zero also sent the dollar surging.
Day Trend: - BUY ON DIP (BULLISH).
INTRADAY RANGE – 73.23 (73.36 – 73.65) 73.74
FOMC
Fed Chairman Jerome Powell downplayed any risk of an immediate interest rate increase as the central bank handed down the decision on Wednesday. He added that officials had begun a discussion about asset tapering and that two interest rate hikes are expected by the end of 2023.
Powell also appeared to temper the initial reaction to a so-called dot plot revision, reiterating that the Fed is not considering rate increases for now. The central bank will also continue asset purchases at a $120 billion monthly pace until “substantial further progress” had been made on employment and inflation.
The Fed’s quarterly projections showed 13 of 18 officials favored at least one rate increase by the end of 2023, versus seven in March. Eleven officials saw at least two hikes by the end of that year. In addition, seven of them saw a move as early as 2022, up from four.
YIELD
The benchmark 10-year Treasury yields jumped 7-8 points trading at 1.5680%, while 5-year and 7-year equivalents rose even more as investors scrambled to reprise the rate increases timing.
OIL PRICE
Crude oil prices fell pressured by a stronger U.S. dollar, but losses were limited by a big drop in crude oil inventories in the United States, the world's top oil consumer.
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