Tag: EVENTS

Currency Insight

Sheetal

Dollar edges up near 2-1/2-month high ahead of Fed outcome

The dollar edged closer to a 2-1/2-month high against a basket of currencies on Wednesday as traders awaited clues from the Federal Reserve about the timing of a U.S. interest rate increase.

A rate hike at the Fed’s two-day policy meeting which ends later on Wednesday is virtually priced out due to underlying concerns over a slowdown in China and the broader impact on global growth.

But many investors still expect the Fed to indicate that interest rates could rise as early as December. The index, which gauges the greenback against six rival currencies, stood at 96.958 , up about 0.1 percent from late U.S. trade and not far from a 2 1/2-month peak of 97.201 scaled on Friday.

Indian rupee ends at one-month low against US dollar, down 32 paise at 65.59

The rupee plunged by 32 paise against the US dollar to one-month low of 65.59 on fresh demand for the American currency from banks and importers amid persistent fall in equity markets coupled with strong foreign capital outflows.

 

The domestic unit opened lower at 65.39 as against last Friday’s level of 65.27 at the Interbank Foreign Exchange (forex) market and dropped further to 65.62 before ending at one-month low of 65.59, showing a loss of 32 paise or 0.49 per cent.

Sterling trades above $1.52, but lags euro on soft UK data

Sterling rose 0.4 percent against a struggling dollar on Tuesday, as investors fretted about when the U.S. Federal Reserve will raise interest rates amid growing doubts over a global recovery.

The International Monetary Fund (IMF) cut its global growth forecasts for a second time this year on Tuesday, citing weak commodity prices and a slowdown in China and said policies aimed at increasing demand were needed.

Important events and their explanation:
Time ( IST) Currency Economic Data Actual Expectation Previous
1:00am USD FOMC Member Dudley Speaks
5:20am JPY Monetary Policy Meeting Minutes
6:00am USD FOMC Member Fischer Speaks
7:00pm USD Unemployment Claims 263K 260K
USD FOMC Member Dudley Speaks
USD Prelim Nonfarm Productivity q/q 0.10% 3.30%
USD Prelim Unit Labor Costs q/q 2.20% -1.40%
7:40pm USD FOMC Member Fischer Speaks

 

Explanation:- Market is heading towards one of the most crucial events of the weeks, Unemployment claims and Non farm we actual data might come negative for the USD.

Quick Glance :
Instrument Price %Chg Volume OI
USD/INR 65.48 0.17 788526 960103
EUR/INR 71.56 -0.82 37048 48836
GBP/INR 100.92 0.07 21059 41217
JPY/INR 54.01 -0.64 7908 15311

 

Technical touch :

USDINR

FOREX USDINR_Daily_1Year

As seen pair has pierced its prolonged Ascending triangle and trading above crucial 65.20 levels.

After a surprise move by the Chinese banks rupee depreciated and touched 64.80 levels.  We assume rupee to form a minor resistance at 65.60 levels.

Once can go long TILL 65.70 LEVELS.

Currency Insight

Sheetal

China gives currency largest boost in a decade

China on Monday raised the daily reference rate for its yuan currency by the largest margin in a decade, officials and reports said, just three months after a surprise devaluation sent shockwaves through global markets.

The central People’s Bank of China adjusted the central rate of the yuan — also known as the renminbi (RMB) — upwards by 0.54 percent against the US dollar, according to a statement.

China now allows the currency to trade up or down two percent from the centrally set daily rate on the domestic foreign exchange market.

EUR/USD off lows but below 1.10

The euro lost ground on Wednesday as data showing euro zone inflation dipped back into negative territory in September fuelled expectations the European Central Bank will expand or extend its asset purchase programme.

The euro fell 0.4 percent to $1.1205, and was down 0.7 percent against the British pound, although it remained on track for a quarterly gain against the dollar.

“A weak number was expected and bolsters expectations that the ECB may have to expand its asset purchase programme from the 60-billion-euros-a-month to something larger, perhaps by year-end,” said Richard Falkenhall, currency strategist at SEB.

“That is negative for the euro, but a lot depends on how stock markets behave. If stocks drop, then the euro is likely to be supported as they are going in opposite ways.”.

Sterling trades above $1.52, but lags euro on soft UK data

Sterling rose 0.4 percent against a struggling dollar on Tuesday, as investors fretted about when the U.S. Federal Reserve will raise interest rates amid growing doubts over a global recovery.

The International Monetary Fund (IMF) cut its global growth forecasts for a second time this year on Tuesday, citing weak commodity prices and a slowdown in China and said policies aimed at increasing demand were needed.

Important events and their explanation:
Time ( IST) Currency Economic Data Actual Expectation Previous
12:30am EUR ECB President Draghi Speaks      
7:15am CNY Caixin Services PMI     50.5
4th-9th GBP Halifax HPI m/m   0.70% -0.90%
2:30pm EUR ECB President Draghi Speaks      
3:00pm GBP Services PMI   54.6 53.3
4:00pm USD FOMC Member Brainard Speaks      
6:45pm USD ADP Non-Farm Employment Change   183K 200K
7:00pm USD Trade Balance   -42.7B -48.3B
8:30pm USD Fed Chair Yellen Testifies      
  USD ISM Non-Manufacturing PMI   56.6 56.9
9:00pm USD Crude Oil Inventories   2.5M 3.4M

 

Explanation:- Market may pay more attention to Fed Yellen testify and ISM Non manufacturing index. We assume above data to come as per the expectation which might be negative for the USD.

Quick Glance :
Instrument Price %Chg Volume OI
USD/INR 65.68 0.17 788526 960103
EUR/INR 72.09 -0.82 37048 48836
GBP/INR 101.23 0.07 21059 41217
JPY/INR 54.39 -0.64 7908 15311

 

Technical touch :

FOREX USDINR_Daily_1Year

Pair is trading near crucial resistance area. Any closing above 65.70 may further push the pair till 65.90 levels. Below this may fall till 65.40 levels.