On Friday, the Euro-Rupee pair crossed its most significant resistance and traded near three month high at 60.77. Even the EUR-USD pair was trading at its two month high at 1.2967. Other Euro crosses like EUR/GBP hits fresh six-week high giving bull momentum to the counter by breaking 0.8415. The recovery of Euro against major currencies can be interpreted as fundamental positive change in the Euro zone. In our Currency market report of July 8 we have indicated that in case of upper break out the EUR-USD pair may touch or pass 1.2834 and the same happened in Thursday’s trading session. Likewise EUR-INR after crossing 60 levels has started new Bull-Run for short term. It may touch 62-64 in coming months if fundamentals supports.
The first half of 2010 is one of the most tumultuous economic periods for Europe. At one side is Greece requiring international assistance to avoid default and on the other are countries from powerhouse Germany to minnow Portugal unveiling austerity plans to calm bond market.
If Euro zone recovery is not illusionary then Gold prices will come down in the coming month. Currently Gold is trading at $1206 in international market and holding against important trend line support.
As per Department of Industrial policy and promotion, ministry of commerce and industry India, foreign direct investment in India for the month of April 2010 was 2.214 -5.3 per cent on Y-o-Y basis while 83.3 per cent on M-o-M basis.
The US-INR pair is still trading below 47, the important psychological resistance. The news in the market which is sufficient for the USD-INR pair fluctuation to currency future counter is defense related payment by Indian government and Indian Oil Company’s payment due to international suppliers.
On Friday, last trading day of week, the USD-INR July future which is due to expire on July 28 traded in very tight zone of 11 paisa. But across the trading day upside momentum was missing. Majority of time pair 6.81 was under pressure and currently trading at 46.81 16:42PM IST.
Technically the USD-INR pair may try to touch 47 again in next week but as global equity market is recovering its bull journey is questionable now. The one year forward premiums for dollar rupee raised in overnight indexed swap on concern of key rate hike.
The Pound-Rupee pair after hitting 5 month high came down due to profit booking. Its July contract kissed 72.29 on Friday trading session in Indian currency future market. Straight Bull-Run from 70.14 to 72.29 is the one of the highest weekly gain for its contract life cycle. The GBP-USD pair rose from 1.4948 and extended its gain to 1.5296 levels. On July 16 due to weekly closing and under pressure of profit booking Major comes down to 1.5377 after testing intraday high of 1.5447.
Likewise the USD-JPY pair is constantly trading below 20-days moving average. And in contrast the JPY-INR pair is trading higher. Its weekly gain at future exchange counter in its July month contract is nearly Rs 1.40. It engulfed last week bear candle on chart. If JPY-USD continues to fall the JPY-INR soon will touch 56.
Global indices status: Nifty 5393.90 (+0.28 per cent) Sensex 17955.82(+0.26 per cent) HANG SENG INDEX 20250.16(-0.03 per cent) SHANGHAI COMPOSITE 2424.271 NIKKEI 9208.36(-2.86 per cent) FTSE100 5267.48(+1.80 per cent) CAC 3607.28(+0.71 per cent) DAX 6199.62(+0.82 per cent) DOW 10359.31(-0.07 per cent)
Reference rate declared by RBI for global currency wrt INR for July 14 is as follows.
July 16 July 15
Dollar 46.80 46.74
Euro 60.37 59.47
Pound 71.0814 71.3089
Yen 53.66 53.06
