Highlights

 India’s industrial production grew by 2 percent in September.

 UK’s Consumer Price Index (CPI) gained 2.2 percent in last month.

 Japan’s Core Machinery Orders fell by 2.1 percent in September.

Asian markets are trading on a negative note today on the back of concerns that Federal Reserve may start its QE tapering sooner than expectations coupled with Chinese government failing to provide details regarding details about policy shift of the government.

US Dollar Index

The US Dollar Index (DX) gained around 0.1 percent yesterday on the back of rise in risk aversion in market sentiments which led to rise in demand for low yielding currency.

Further, expectations that Federal Reserve may start its QE tapering program sooner than estimated exerted downside pressure on the currency. The DX touched an intra-day high of 81.55 and closed at 81.25 on Tuesday.

Dollar/INR

The Indian Rupee depreciated around 0.7 percent in yesterday’s trading session. The Rupee depreciated on the back of dollar demand from importers. Further, weak domestic market sentiments along with strength in the DX exerted downside pressure on the currency.

In the later part of the trade, expectations of favorable industrial production and manufacturing output data from the country also could not provide respite to depreciation in the Indian Rupee. The currency touched an intra-day low of 63.84 and closed at 63.71 on Tuesday.

India’s industrial production grew by 2 percent in September as against a rise of 0.6 percent in August. Manufacturing output increased by 0.6 percent in September from decline of 0.1 percent a month ago. Consumer Price Index (CPI) jumped to 10.1 percent in September with respect to 9.8 percent in prior month.

For the month of November 2013, FII inflows totaled at Rs.3625.50 crores ($585.34 million) as on 12thNovember 2013. Year to date basis, net capital inflows stood at Rs.92559.20 crores ($16784.30 million) till 12thNovember 2013.

Outlook

From the intra-day perspective, we expect Indian Rupee to trade on a negative note on the back of less than expected rise in industrial production and manufacturing output data in yesterday’s trade. Further, sharp rise in retail inflation of the country, weak market sentiments along with stronger DX will exert downside pressure on the currency. Additionally, dollar demand from importers coupled with forecast for rise in wholesale inflation data from the country during the week will act as a negative factor.

Technical Outlook valid for November 13, 2013

Trend Support Resistance

US Dollar/INR Nov’13 (NSE/MCX-SX)

Up 63.85/63.60 64.25/64.45

Euro/INR

The Euro appreciated around 0.2 percent yesterday on the back of favorable economic data from the region. Further, upbeat market sentiments in early part of the trade supported an upside in the currency.

However, sharp upside in the currency was restricted due to strength in the DX. The Euro touched an intra-day high of 1.3456 and closed at 1.3435 on Tuesday.

German Wholesale Price Index (WPI) declined by 1 percent in October as compared to a gain of 0.7 percent in September.

Outlook

In today’s session, we expect Euro to trade lower on account of weak market sentiments along with strength in the DX. Further, expectations of decline in region’s industrial production in today’s trade coupled with forecast for GDP data during the week will add downside pressure on the currency.

Technical Outlook valid for November 13, 2013

Trend Support Resistance

Euro/INR Nov’13 (NSE/MCX-SX)

Up 85.55/85.30 86.00/86.30

GBP/INR

The Sterling Pound depreciated by 0.5 percent on the back of unfavorable inflation data from the region. Also, weak global market sentiments coupled with strength in the DX acted as a negative factor. The currency touched an intra-day low of 1.5852 and closed at 1.5904 on Tuesday.

UK’s Consumer Price Index (CPI) gained 2.2 percent in October as against a gain of 2.7 percent in September. Producer Price Index (PPI) declined by 0.6 percent in October as compared to a gain of 1 percent in September.

Outlook

From the intra-day perspective, we expect Pound to trade on a lower note on account of weak market sentiments coupled with strength in the DX. However, sharp downside in the currency can be cushioned or reversal can be seen as a result of forecast for favorable employment data from the country.

Technical Outlook valid for November 13, 2013

Trend Support Resistance

GBP/INR Nov’13 (NSE/MCX-SX)

Up 101.50/101.25 102.10/102.40

JPY/INR

The Japanese Yen depreciated by 0.5 percent yesterday taking cues from upbeat global market sentiments in the earlier part of the trade which led to decline in demand for low yielding currency. The Yen touched an intra-day low of 99.79 and closed at 99.62 on Tuesday.

Japan’s Core Machinery Orders slumped by 2.1 percent in September as against again of 5.4 percent in August.

Outlook

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

Technical Outlook valid for November 13, 2013

Trend Support Resistance

JPY/INR Nov’13 (NSE/MCX-SX)

Sideways 64.00/63.85 64.50/64.80

Read More AS

Daily Currency Technical Report 13 November

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