Rupee lower, Australian Dollar lower

Tuesday,   23-Apr-2019   12:22 PM (IST)

The Indian rupee is trading lower at 69.74/75 levels (12:15 pm) in the afternoon deals after touching the low of 69.83/84 levels as importers prop up dollar purchases. Higher oil prices are weighing on rupee. Crude oil prices rose for a third consecutive session today after the U.S. announced that all importers of Iranian oil will have to end their imports by May 1 or face U.S. sanctions. The benchmark Brent crude oil contract rose to more than $74.60 per barrel. Rupee touched the high of 69.54/55 levels early today on the back of dollar sales by corporates. Traders await the outcome of the central bank’s $5 billion forex swap auction. Earlier this month, the Reserve Bank of India announced that on Apr. 23 it will conduct a second $5 billion 3-year dollar-rupee swap auction to augment domestic liquidity. At the previous auction conducted last month, the central bank had received bids for more than three times the auctioned amount. Traders also watch conclusion of Essel Propack Ltd.’s stake sale to U.S.-based Blackstone Group for $310 million to $462 million, based on the open offer. Benchmark indices are trading higher. At 12:10 PM, the S&P BSE Sensex was trading at 38,774 up 129 points, while the broader Nifty50 was at 11,636, up 41 points. As per the technical indicators, range for USDINR pair for the remaining part of the day may be 69.40-70.00 levels. Rupee has an immediate support at 69.86 levels. A breach of the same may see rupee at 69.99 followed by 70.15 and 70.31 levels. On the positive side rupee is likely to face resistance at 69.57 levels and if it is able to break the same then it may gain up to 69.41 levels followed by 69.28 and 69.15 levels. In the forward segment 1mth, 3mth and 6mth annualized premia are currently trading at 5.84%, 4.73% and 4.43% respectively.

A cautious tone prevailed across Asia this Tuesday, with full markets returning after a four-day Easter break, as traders digest the latest US-Iran geopolitical woes and a slew of comments from the Japanese officials heading into the Bank of Japan (BOJ) monetary policy meeting scheduled later this week. Against a backdrop of mixed action in the Asian equities, the USD/JPY pair broke its recent range trade to the downside and hit fresh weekly lows at 111.65 before rebounding quickly to near 111.85 region following dovish remarks from a senior BOJ official Maeda and broad USD bounce. The AUD/USD pair reached multi-day lows near 0.7113 while the Kiwi traded on the back foot near 0.6670. The Canadian dollar was the strongest once again this session, mainly in response to the recent oil price rally, as the US called on to end all the waivers on the US sanctions against Iran’s energy sector.