Rupee steady, Euro higher vs. dollar

Monday,   22-Oct-2018   12:24 PM (IST)

The Indian rupee is trading steady at 73.30/31 levels (12:15 pm) in the afternoon deals after touching the high of 73.1975/2075 levels as foreign banks stepped up greenback sales, likely on behalf of their exporter  clients, amid rebound in regional and local shares. Rupee fell to 73.3850/3950 levels in early deals. The slump in the foreign exchange reserves data was on the expected lines as the rupee was hitting record lows, indicating that the central bank was not comfortable with the sharp depreciation. The benchmark indices are trading slightly higher amid a firm rupee against the dollar. At 12:15 PM, the S&P BSE Sensex was trading at 34,508, up 192 points while the broader Nifty50 was ruling at 10,360, up 56 points. As per the technical indicators range for the USDINR pair may be 72.90 - 73.65 levels. Rupee has an immediate support at 73.39 levels. A breach of the same may see rupee at 73.48 followed by 73.58 and 73.68 levels. On the positive side rupee is likely to face resistance at 73.20 levels and if it is able to break the same then it may gain up to 73.11 levels followed by 73.02 and 72.92 levels. In the forward segment 1mth, 3mth and 6mth annualized premia are currecntly trading at 4.55%, 4.38% and 4.30% respectively.

The Euro is trading at around 1.1540 after the German versus Italian government bond spread eased 17 basis points to 289 basis points. Although the beginning of the week is data empty, the ECB Governing Council meeting headlines the week on Thursday. Sterling is trading up 0.1% at around 1.3080 after the UK Prime Minister Theresa May said 95% of Brexit deal has been agreed upon. The mix of Brexit deal failure at the European Council meeting and disappointing macroeconomic data saw Sterling fall as low as 1.3011 last week just to recover on Brexit positive rumors after the weekend.