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Rupee lower, Australian Dollar up

Friday,   12-Jul-2019   12:23 PM (IST)

The Indian rupee is trading lower at 68.57/58 levels (12:18 pm) after touching the low of 68.59/60 levels in line with most Asian peers, amid uncertainty about the Fed’s next rate decision. Rupee opened at 68.45/46 levels and fell in later deals on the back of dollar buying by private banks. Indices are trading flat. At 12:19 PM, the S&P BSE Sensex was trading at 38,811, down 13 points, while the broader Nifty50 was at 11,579, down 4 points. As per the technical indicators, range for USDINR pair for the remaining part of the day may be 68.25-68.75 levels. Rupee has an immediate support at 68.62 levels. A breach of the same may see rupee at 68.74 followed by 68.83 and 68.99 levels. On the positive side rupee is likely to face resistance at 68.50 levels and if it is able to break the same then it may gain up to 68.37 levels followed by 68.28 and 68.20 levels. In the forward segment 1mth, 3mth and 6mth annualized premia are currently trading at 3.76%, 4.09% and 4.35% respectively. India’s May IIP and June retail inflation data is due later today.

A sense of calm prevailed in the market, with most majors extending their recovery mode amid fresh US dollar weakness across the board. The Asian traders continue to weigh in the dovish Fed Chair Powell’s testimony and shrugged off upbeat US inflation data. However, the Treasury yields attempted a tepid bounce across the curve, having kept Gold prices sidelined below the 1410 level. Among the Asia-pac currencies, the USD/JPY pair enjoyed good two-way businesses so far this Friday. The spot extended the overnight recovery near 108.60 region before receding sharply to test the key support of 108.31. The Aussie extended the rebound and tested the 0.70 handle despite looming US-China trade uncertainty while the NZD/USD pair rallied hard in a bid to regain the 0.67 handle. The recent strength in oil prices also helped the commodity currency, the Kiwi, as the oil bulls were underpinned by the risks of Gulf of Mexico storm turning into a hurricane and escalating Middle East tensions. Meanwhile, both the EUR/USD and Cable traded firmer amid a broadly weaker US dollar and ahead of the Eurozone Industrial Production data release.