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Rupee higher, AUDUSD up

Wednesday,   11-Sep-2019   12:21 PM (IST)

The Indian rupee is trading higher at 71.65/66 levels (12:15 pm) in the afternoon deals after touching the high of 71.6425/6525 levels on dollar sales by a foreign banks. Rupee dipped to 71.85/86 levels in early deals today tracking weak Asian units as traders await outcome of key central banks’ policy meetings. Benchmark indices inched higher after a flat open, lifted by gains in metal stocks. At 12:11 PM, the S&P BSE Sensex was trading at 37,324, up 179 points, while the broader Nifty50 was at 11,039, up 36 points. As per the technical indicators, range for USDINR pair for the remaining part of the day may be 71.50-72.10 levels. Rupee has an immediate support at 71.77 levels. A breach of the same may see rupee at 71.92 followed by 72.05 and 72.18 levels. On the positive side rupee is likely to face resistance at 71.57 levels and if it is able to break the same then it may gain up to 71.50 levels followed by 71.36 and 71.22 levels. In the forward segment 1mth, 3mth and 6mth annualized premia are currently trading at 4.26%, 4.14% and 4.22% respectively.

Market mood improves on fresh US-China trade optimism after Global Times editor reported China will introduce important measures to ease the negative impact of the trade war. Meanwhile, China released tariffs exemption list for products from the US. The US yields extend gains alongside Asian equities and Wall Street futures while and dollar eases against the euro and risk/ commodity currencies. The Yen remains the main laggard at six-week lows near 107.85 vs. the buck on trade progress and dovish BOJ expectations. EUR/USD clings to minor gains around 1.1050 amid the recent rally in German bund yields, awaiting Thursday’s ECB monetary policy outcome. The German stimulus talks pushed 30-year bund yields into positive territory. GBP/USD trades above 1.2350 ahead of an empty UK docket and bi-weekly EU-UK Brexit negotiations. UK Parliament passed a law to block a no-deal Brexit. UK MPs launched a new group to try to secure Brexit deal. PM Johnson said that he is opposed to the idea of a so-called Northern Ireland-only backstop to get a Brexit deal done. Oil prices jump on large US crude inventory draw, reversing the drop fueled by speculation of sanctions-hit Iranian crude returning to the market after US President Trump’s fired Iran-policy hawk, Bolton. Meanwhile, Gold holds the lower ground sub-$ 1500.