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Rupee higher, USDJPY up

Tuesday,   11-Jun-2019   12:23 PM (IST)

The Indian rupee is trading higher at 69.41/42 levels (12:15 pm) in the afternoon deals following a recovery in the Chinese Yuan after U.S. President Donald Trump accused Beijing of manipulating its currency. So far rupee traded in the range of 69.41-69.50 levels. Globally, focus remains on developments on U.S. and China trade and how it impacts Asian currencies. Traders will eye India’s retail inflation and industrial output data, due tomorrow. At 12:04 PM, the S&P BSE Sensex was trading at 39,915 up 128 points, while the broader Nifty50 was at 11,957, up 35 points. As per the technical indicators, range for USDINR pair for the remaining part of the day may be 69.25-69.80 levels. Rupee has an immediate support at 69.48 levels. A breach of the same may see rupee at 69.57 followed by 69.64 and 69.71 levels. On the positive side rupee is likely to face resistance at 69.39 levels and if it is able to break the same then it may gain up to 69.30 levels followed by 69.19 and 69.08 levels. In the forward segment 1mth, 3mth and 6mth annualized premia are currently trading at 4.25%, 4.04% and 4.08% respectively.

FX today witnessed a quiet Asian affair amid a risk-on action in the Asian equities and limited macro news. However, the most majors stuck to thin trading ranges on looming US-China trade conflict and a broadly subdued US dollar. The Kiwi was the main laggard for the second straight session and gave up 0.66 handle yet again while the Aussie traded on the back foot just ahead of the 0.6950 support amid mixed Australian NAB survey, stronger Yuan and higher commodities’ prices. The USD/CNY pair pulled back from YTD highs of 6.9358 and traded weaker near 6.9160 levels, as the PBOC unexpectedly set a stronger Yuan fix. The USD/JPY pair held onto the gains as markets continued to cheer the US-Mexico trade progress. But the further upside remained capped in response to mounting US economic risks and Fed rate cut expectations. Meanwhile, both the European currency pairs, EUR/USD and Cable traded modestly flat amid a lack of fresh catalysts. Amongst the commodities, both crude benchmarks edged higher ahead of the US weekly supply reports while gold futures on Comex traded little changed below 1330 levels amid higher Treasury yields.