USDINR
On Thursday, USDINR most likely to commence near all-time high between 79.65 -79.75 levels as dollar index trading above 108 mark as USA Labor Department showed rising costs of gas, food and rent drove the consumer price index (CPI) up 9.1% last month from a year earlier.
On Wednesday, The Indian rupee hit a record low for a third straight session as FII continued to dump riskier assets of U.S. inflation data that could determine the pace of tightening in the world's largest economy. The partially convertible rupee per dollar compared to its previous close of 79.5975, the unit finished for the day on a life low of 79.6875/79.6975.
USA INFLATION
Year-on-year consumer price growth accelerated to a scorching 9.1%, the hottest reading since November 1981, driven by an 11.2% monthly spike in gasoline prices.
The report raised odds that the Federal Reserve will raise interest rates even more than the 75 basis points previously expected. Traders of futures tied to the Fed funds target rate have now priced in the probability of a larger, 100 basis point, hike at the conclusion of its policy meeting later this month.
THE EURO
On Wednesday, The euro dropped below parity against the dollar the first time in almost two decades, as a hawkish U.S. Federal Reserve and growing concern about rising recession risks in the euro area continued to batter the single currency.
We are seeing that parity is acting as a support level at present, but should it break $0.9995 we see room for a move all the way to $0.97 and possibly even $0.95.
USDINR TECHNICAL
Day Trend: - BUY ON DIP (Short Term)
Weekly Trend: - HOLD
INTRADAY RANGE – 79.79 (79.66 – 79.45) 79.31
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