Rupee traded lower, Pound little changed Vs Dollar

Tuesday,   16-Oct-2018   12:31 PM (IST)

The Indian rupee gave up early gains against the dollar in afternoon trade and is currently trading at 73.90/91 levels (12:15 pm). Rupee opened at 73.8050/8150 levels today and moved lower to 73.95/96, as foreign and private lenders stepped up greenback purchases for importers, outweighing gains triggered from a weaker-than-expected U.S. retail sales data. Indian government bonds fell in early trade tracking the rupee and as traders short sold the benchmark note after it was unexpectedly included in this week's bond sale. Benchmark equity indices rose on Tuesday amid positive global markets and stronger second quarter earnings so far. As per the technical indicators range for the USDINR pair may be 73.55- 74.15 levels. Rupee has an immediate support at 73.96 levels. A breach of the same may see rupee at 74.17 followed by 74.26 levels. On the positive side rupee is likely to face resistance at 73.67 levels and if it is able to break the same then it may gain up to 73.58 levels followed by 73.37 levels. In the forward segment 1mth, 3mth and 6mth annualized premia are currently trading at 4.75%, 4.43% and 4.31% respectively.

Sterling is trading little changed at around mid 1.3100s ahead of UK labor market report while the UK government starts meeting before crucial Brexit summit due on Wednesday. The UK wages growth is of particular interest for the market with expectations of slight decelerations in both regular and total pay while the unemployment is set to remain at a 4-decade low of 4.0%. Meanwhile, the U.S. dollar edged up on Tuesday after it was dented by weak U.S. retail sales data overnight, while New Zealand's currency gained on the back of stronger than expected inflation data. Both the yen and Swiss franc have attracted buyers amid tensions between the Western powers and Saudi Arabia, which has been under pressure since a prominent Saudi journalist Jamal Khashoggi, a critic of Riyadh and a U.S. resident, disappeared on Oct. 2 after visiting the Saudi consulate in Istanbul. An impasse over Brexit talks and global trade tensions has added to the list of negative factors that battered global stocks.