The proposed big ticket sale of large state run public sector enterprises will result in huge inflows over the coming months. A better fundamental view of the economy and the sale has resulted in exporters and others using the current rise to sell forward. Next week US FOMC meet will be the key. Rupee will fall to 60.56 and 60.10 against the US dollar (inter-bank) if the Federal Reserve does not raise interest rates. The only risk to the rupee for now is profit taking in Indian stock markets.
In the next one year, I am only concerned by crude oil prices and its impact in India. The NDA government will be tested if and when global crude oil prices start to rise once again. In my view crude oil prices will form a long term bottom in the next two months to three months and thereafter start to rise. Higher crude oil prices can shake the fiscal deficit of India.
There is speculation that there can be a credit rating upgrade of India by some global rating agencies. This should result in more gains for the rupee. Better to remain on the sidelines. Euro and cable can rise further.
Usd/inr September 2014: Further rise will be there if and only if usd/inr breaks and trade over 61.3725. In case usd/inr does not break 61.3725 by Monday then it will trade in 60.4725-60.8625-61.0275-61.3725 range.
Euro/inr September 2014: A break of 79.12 will result in 79.39 and 79.76. Initial support is at 77.76. There will be sellers only below 77.76.
Gbp/Inr September 2014: It needs to trade over 99.18 to rise to 99.96 and 100.36. Initial support is at 99.18 and there will be sellers if cable trades below 99.18 in UK session.
Jpy/Inr September 2014: Till next week 56.85 is the key support. There will be a technical break down below 56.85 to 56.56 and 56.32. Overall jpuy/inr is bearish as long as it trades below 57.18.
In the next one year, I am only concerned by crude oil prices and its impact in India. The NDA government will be tested if and when global crude oil prices start to rise once again. In my view crude oil prices will form a long term bottom in the next two months to three months and thereafter start to rise. Higher crude oil prices can shake the fiscal deficit of India.
There is speculation that there can be a credit rating upgrade of India by some global rating agencies. This should result in more gains for the rupee. Better to remain on the sidelines. Euro and cable can rise further.
Usd/inr September 2014: Further rise will be there if and only if usd/inr breaks and trade over 61.3725. In case usd/inr does not break 61.3725 by Monday then it will trade in 60.4725-60.8625-61.0275-61.3725 range.
Euro/inr September 2014: A break of 79.12 will result in 79.39 and 79.76. Initial support is at 77.76. There will be sellers only below 77.76.
Gbp/Inr September 2014: It needs to trade over 99.18 to rise to 99.96 and 100.36. Initial support is at 99.18 and there will be sellers if cable trades below 99.18 in UK session.
Jpy/Inr September 2014: Till next week 56.85 is the key support. There will be a technical break down below 56.85 to 56.56 and 56.32. Overall jpuy/inr is bearish as long as it trades below 57.18.
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