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Covid surge, macros to dampen rupee
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Top Stories |
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SME Times News Bureau | 29 Mar, 2021
Weak economic outlook due to domestic resurgence in Covid-19 cases is
expected to dampen rupee's prospects during the upcoming week.
Besides, macro economic data points such as a wider fiscal deficit are likely to support the trend.
"Fears
of higher Covid-19 cases along with rising inflation will dampen the
equity market and rupee during the truncated trade sessions of next
week," Sajal Gupta, Head, Forex and Rates at Edelweiss Securities told
IANS.
Lately, a new wave of Covid-19 infections has hit several
states. This trend comes at a time when India is trying to ramp up the
vaccination drive.
Besides, risk of higher inflation as well as
slower economic recovery is expected to hamper foreign inflows into the
equity segment, thereby, further subduing the rupee.
"It will be a
holiday-shortened week as there are only two trading sessions. Volumes
will remain light - as many traders will choose to keep their positions
light," said Devarsh Vakil- Deputy Head of Retail Research at HDFC
Securities.
"Spot USDINR is expected to trade between the range of 72.26 to 72.80 this week."
Currency
markets are closed next week on account of Holi on Monday followed by
Thursday for annual bank closing and then on 'Good Friday'.
"The
worst of the pandemic is behind us, and the risk appetite has taken
another significant stride higher but we need more catalyst. Next week
is a truncated fx week, and in the interim, market participants will
look for signs that Covid-19 cases are making a resurgence globally to
simmering US-China tensions," said Rahul Gupta, Head Of Research-
Currency, Emkay Global Financial Services
"However, unless any
nation stops the vaccine rollout, the rapid vaccination drive by the US
will keep the risk appetite higher. While lockdown in Europe and upbeat
US data will limit any fall in the USDINR spot. Thus, until the spot is
trading below 73 zones, the trend will be bearish, with crucial support
being 72.20."
According to Gaurang Somaiya , Forex & Bullion
Analyst, Motilal Oswal Financial Services: "Less number of cues on the
domestic and global front is likely to keep the volatility low for the
currencies. On the domestic front, fiscal deficit number will be
released; expectation is that the number could be disappointing and that
could keep the rupee weighed down against its major crosses."
"Later
in the week, non-farm payrolls number will also be important to watch
and better-than-expected economic number could extend gains for the
greenback. the week, the USDINR (Spot) to trade with a positive bias and
quote in the range of 72.20 and 73.20."
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
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66.20
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64.50 |
UK Pound
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87.50
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84.65 |
Euro
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78.25
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75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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