India Rupee Steady Ahead Of MPC Outcome; Powell Speech Eyed

6 February 2019 / Morning Brief

Indian Rupee

• The Indian rupee little changed at 71.55 pair now at 71.52 against 71.56 previous close.
• Pair to tip in 71.40-71.70 range today.
• The Indian rupee was little changed against the dollar in early trade, as investors awaited monetary policy decision at home and a speech from the Federal Reserve Chairman Jerome Powell, both due tomorrow. Rupee is seen consolidating at the current level amid lack of triggers today. A dovish RBI will aid rupee’s gains as rate cut is seen as growth-positive, helping equity and bond market valuation and thereby attracting capital inflows. Persistent dollar outflows post interim budget from domestic bonds is a cause of concern for the rupee, but inflows in equities has limited the impact.

Global Currency

• The dollar managed to rise although U.S. Treasury yields declined the previous day and pulled back from one-week highs. dollar is managing to draw support in spite of lower Treasury yields thanks to a combination of a dovish-sounding Federal Reserve and U.S. data, which has been relatively strong on the whole recently.
• The euro was little changed at $1.1407 EUR after slipping 0.25 percent the previous day to its lowest since Jan. 28. The single currency was pressured after a survey released on Tuesday showed euro zone businesses expanded at their weakest rate since mid-2013 at the start of the year.

Global Markets

• Oil prices edged higher for the first time in three sessions on Wednesday, although concerns over the outlook for the global economy capped gains. U.S. crude oil were at $53.74 per barrel.
• The State of the Union and what President Donald Trump tell Congress is giving a gold a bid even as the dollar retains its upward bias. Fresh concerns about the U.S. economy after a back-to-back slump in durable goods orders and services sector data boosted the yellow metal in the spot market.

Global Markets at one Glance

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