Rupee weak on weak August industrial numbers

Industrial activity in August was bound to fall in India. Food prices in North India and North West India had stabilized in August but so far have not fallen. People are still feeling the pinch of high cost of fruits and vegetables. This has resulted in consumers postponing their expenditure on consumer durables and other expenses for the festive season which begins from 23rd September. September and October numbers of Indian economy numbers should beat even most of the optimistic forecast. Gold imports in August also had fallen drastically. Chinese president visit to India this week will be closely watched. There will be long term political implications of the same. 

The Federal Reserve meeting will impact the Indian rupee in a big way if they give clear indications of a series of quick interest rate hike. Indian economy can bear an interest rate hike upto one percent (by the Federal Reserve) in the next twelve months. Anything above this can result in a repeat of last year for the rupee albeit at a slower pace. Better to remain on the sidelines. 

Usd/inr September 2014:  Key short term resistance is at 61.72 In case usd/inr does not break 61.72 this week, then it will fall to 60.04. Initial resistance is at 61.30 and only a break of 61.30 will result in further rise. 

Euro/inr September 2014: A break of 79.35 will result in 79.39 and 79.78 and 90.20. Initial support is at 78.70 and as long as euro/inr trades over 78.70 downside risk will be limited. 

Gbp/Inr September 2014: It needs to trade over 99.31 to rise to 99.7850 and 100.68. Initial support is at 98.92 and there will be sellers if cable trades below 98.92 in UK session. 

Jpy/Inr September 2014: It can rise to 57.71 and 58.11 this week as long as it trades over 56.6275. Jobbers watch 57.01 all the time.