Highlights

  •  India’s Wholesale Price Index (WPI) rose to 7 percent in October.
  •  US Industrial Production declined by 0.1 percent in the last month.
  •  Euro Zone’s Core CPI gained by 0.8 percent in the month of October.

Asian markets are trading on a positive note today on the back of statement from Federal Reserve nominee Janet Yellen stating that stimulus measures will be maintained until US economy improves along with China relaxing its economic reforms.

Indian Wholesale Price Index (WPI) rose to 7 percent in October from 6.46 percent in September.

US Dollar Index

The US Dollar Index (DX) declined around 0.6 percent in the last week on the back of rise in risk appetite in market sentiments in later part of the trade which led to fall in demand for low yielding currency. Further, statement from Federal Reserve nominee Janet Yellen that stimulus measures to be maintained until improvement is seen in the US economy exerted downside pressure on the currency. The DX touched a weekly low of 80.80 and closed at 80.90 on Friday.

US Empire State Manufacturing Index declined by 2.2 level in November as against a gain of 1.5-mark in October. Industrial Production declined by 0.1 percent in October as compared to a gain of 0.7 percent in September.

Dollar/INR

On a weekly basis, Indian Rupee depreciated around 0.8 percent on the back of rise in retail and wholesale inflation data from the country. Further, less than expected rise in industrial production and manufacturing data from the country coupled with dollar demand from importers exerted downside pressure on the currency. Additionally, expectations of shutdown in swap window created by Reserve Bank of India (RBI) for OMC’s acted as a negative factor.

However, sharp downside was restricted as a result of selling of dollars by exporters and state run banks. Also, statement from Reserve Bank of India (RBI) Governor Raghuram Rajan that central bank will come out with appropriate steps in the future failed to provide respite to fall in the Rupee. The currency touched a weekly low of 63.90 closed at 62.97 on Friday.

For the month of November 2013, FII inflows totaled at Rs.4002.20 crores ($644.57 million) as on 14thNovember 2013. Year to date basis, net capital inflows stood at Rs.92935.90 crores ($16843.50 million) till 14thNovember 2013.

Outlook

From the intra-day perspective, we expect Indian Rupee to trade on a mixed note on the back of upbeat market sentiments coupled with weakness in the DX which will lead to appreciation in the currency. While on the other hand, sharp upside in the Rupee will be capped or reversal can be seen as a result of dollar demand from importers along with unfavorable economic data from the country in the last week.

Technical Outlook valid for November 18, 2013

Trend Support Resistance

US Dollar/INR Nov’13 (NSE/MCX-SX)

Sideways 63.30/63.10 63.70/63.90

Euro/INR

The Euro appreciated around 0.9 percent in the last week on the back of weakness in the DX. Further, upbeat market sentiments supported an upside in the currency.

However, sharp upside in the currency was restricted due to decline in industrial production and GDP data from the region. The Euro touched a weekly high of 1.3505 and closed at 1.3495 on Friday.

Italian Trade Balance declined to 0.79 billion Euros in September from 1.07 billion Euros in August. Euro Zone’s Core Consumer Price Index (CPI) gained 0.8 percent in October as compared to a gain of 1 percent in September.

Outlook

In today’s session, we expect Euro to trade higher on account of upbeat market sentiments along with weakness in the DX. Further, expectations of favorable trade Balance data from the region will support an upside in the currency.

Technical Outlook valid for November 18, 2013

Trend Support Resistance

Euro/INR Nov’13 (NSE/MCX-SX)

Sideways 85.00/84.80 85.50/85.70

GBP/INR

On a weekly basis, The Sterling Pound appreciated by around 0.6 percent on the back of favorable employment data from the country. Further, weakness in the DX coupled with upbeat market sentiments in supported an upside in the currency.

Additionally, decline in retail sales data from the country along with mixed data on inflation front capped sharp gains in the currency. The Pound touched a weekly high of 1.6133 and closed at 1.6119 on Friday.

Outlook

From the intra-day perspective, we expect Pound to trade on a positive note on account of upbeat market sentiments. Additionally, a weaker DX will also act as a positive factor for the Sterling Pound.

Technical Outlook valid for November 18, 2013

Trend Support Resistance

GBP/INR Nov’13 (NSE/MCX-SX)

Sideways 101.40/101.20 101.80/102.00

JPY/INR

The Japanese Yen depreciated by more than 1 percent in prior week taking cues from upbeat global market sentiments which led to fall in demand for the low yielding currency. Further, unfavorable economic data from the country exerted downside pressure on the currency. The Yen touched a weekly low of 100.43 and closed at 100.18 on Friday.

Outlook

Depreciation in the Yen is expected in today’s trade as a result of rise in risk appetite in market sentiments which will lead to fall in demand for the low yielding currency.

Technical Outlook valid for November 18, 2013

Trend Support Resistance

JPY/INR Nov’13 (NSE/MCX-SX) Sideways 63.40/63.20 63.70/63.90

Courtesy: angel commodities

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