USDINR
The Rupee is most likely to commence the Tuesday session with a firm note between 77.50 -77.60 levels against the greenback as the dollar weakened with risk sentiment boosted by hopes that loosening lockdowns in China can help global growth.
India's export duty hikes and tax cuts will likely hurt economic growth and raise the chances of the fiscal deficit widening, but do little to bring down retail prices within the central bank's tolerance level, economists said.
The Indian government is likely to stick to its fiscal deficit target as specified in the budget and there may not necessarily be a need for increased government borrowing just yet, Governor Shaktikanta Das.
THE DOLLAR
The safe-haven dollar appears to have lost momentum with risk sentiment on the rise, boosted by the news that Shanghai, China’s commercial hub, is set to lift its city-wide lockdown and return to more normal life from June 1.
THE RUBLE
The Russian ruble surged again to a new four-year high, as the weight of foreign inflows generated by its energy exports continued to support the currency.
Russia's current account surplus has ballooned this year as the West's efforts to punish the Kremlin for its invasion of Ukraine have put a big geopolitical risk premium on oil and gas. That has allowed the central bank to reverse some of the emergency measures it took to support the ruble immediately after the invasion. It has now cut its key rate to 14% from 20% and has relaxed some of its more marginal capital controls on the banking system.
USDINR TECHNICAL
Day Trend: - BUY ON DIP (Short Term)
Weekly Trend: - HOLD
INTRADAY RANGE – 77.87 (77.66 – 77.46) 77.25
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