Tomorrow’s railway budget will give us a feel of the things to come. There is no major US economic data releases this week. Trend is downside for the rupee. Investors expect Indian stock markets to zoom after the budget. Developments in Iraq and Ukraine will be the key.
Global investors believe that there will be huge stake sale in some of the large public sector undertaking. They are vying for a pie in these companies. The Narendra Modi government is an ardent follower of Thatcherisation. This implies more and more divestment in public sector undertakings. Foreign inflows will continue to pour in India. It is now upto to government and the Reserve bank of India to sterilize these flows so that a stronger rupee does not hurt exports and also prepare for the US interest rate hikes next year.
In case the Indian stock markets do not correct after the budget then I expect them to fall anytime between the last week of August and first week of September. Reason is quarter end profit taking will drag down stock markets and could weigh on the rupee. Importers having payables during this period need to be careful and in case the rupee gains sharply, then they should consider covering their September payables.
Usd/inr July 2014: Key resistance is at 60.19 and a break of 60.19 will result in 60.43-60.67.In case usd/inr does not break 60.19 today then it will fall to 59.8175 and 59.5575.
Euro/inr July 2014: It needs to trade over 81.56 to target 81.79-82.03-82.51. There will be sellers only below 81.56 to 81.21-80.71.
Gbp/Inr July 2014: A break of 103.07 will result in 103.31-103.67. Initial support is at 102.70 and there will be sellers only below 102.70
Jpy/Inr July 2014: Key support is at 58.5475 and yen/inr needs to trade over 58.5475 this week to target 59.3975-60.13. There will be a technical breakdown below 58.5475 to 58.2325-57.80,
Global investors believe that there will be huge stake sale in some of the large public sector undertaking. They are vying for a pie in these companies. The Narendra Modi government is an ardent follower of Thatcherisation. This implies more and more divestment in public sector undertakings. Foreign inflows will continue to pour in India. It is now upto to government and the Reserve bank of India to sterilize these flows so that a stronger rupee does not hurt exports and also prepare for the US interest rate hikes next year.
In case the Indian stock markets do not correct after the budget then I expect them to fall anytime between the last week of August and first week of September. Reason is quarter end profit taking will drag down stock markets and could weigh on the rupee. Importers having payables during this period need to be careful and in case the rupee gains sharply, then they should consider covering their September payables.
Usd/inr July 2014: Key resistance is at 60.19 and a break of 60.19 will result in 60.43-60.67.In case usd/inr does not break 60.19 today then it will fall to 59.8175 and 59.5575.
Euro/inr July 2014: It needs to trade over 81.56 to target 81.79-82.03-82.51. There will be sellers only below 81.56 to 81.21-80.71.
Gbp/Inr July 2014: A break of 103.07 will result in 103.31-103.67. Initial support is at 102.70 and there will be sellers only below 102.70
Jpy/Inr July 2014: Key support is at 58.5475 and yen/inr needs to trade over 58.5475 this week to target 59.3975-60.13. There will be a technical breakdown below 58.5475 to 58.2325-57.80,
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