Till now the focus of the new government was to put in place the budget. Once the budget session of parliament is over, the pace of implementation of the schemes will rise. Still Monsoon and the upcoming drought in North, central and western India will be a big test for the new government. I expect a lot of policies changes to be announced by way of ordinance.
On the global front expectations of higher interest rates in USA early next year and Portuguese bank default has resulted in the rupee getting weaker.
To me the biggest challenge for the Indian administrators (whether state government or central government) will be to address food price inflation. Acche din for the aam aadmi will only come when food prices stabilize for the next four months.
There can be more weakness in the rupee. Portuguese bank problems and short covering in the rupee can add to
Usd/inr July 2014: It can rise to 60.76-61.15 as long as it trades over 60.10. There will be sellers only below 60.10 or in case uysd/inr does not break 60.76 today
Euro/inr July 2014: It can rise to 82.76-83.04 as long as it trades over 82.04. Initial support is at 82.04 and there will be sellers only below 82.04
Gbp/Inr July 2014: Cable needs to trade over 103.31 to rise to 103.86-104.21. Initial support is at 103.31 with 102.91 as the key intraday support.
Jpy/Inr July 2014: Yen/inr can rise to 60.10-60.36 as long as it trades over 59.35. There will be sellers only below 59.35 today.
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