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India Rupee Falls For 2nd Week As Fiscal Woes Spur Outflows

18 January 2019 / Evening Brief

Indian Rupee

  • The rupee settled at 71.18 against 71.0450 at the previous close. The local unit moved in 71.0625-71.2325 per dollar band intra-day.
  • The Indian rupee fell for a second week, as concerns that likely preelection spending may lead the nation to deviate from its fiscal consolidation path triggered outflows from local bonds. Amid domestic fiscal worries, inflows are subdued as investors are not very keen on investing in such country’s assets The pressure will likely continue until some clarity is attained. However, U.S-China trade talks will be the next immediate trigger to influence rupee’s move. We expects rupee to trade in a 70.70-71.40 band until the interim budget that is likely to be detailed on Feb. 1

Global Currency

  • The dollar held firm against its rivals on Friday and is poised for its first weekly gain in five weeks as investors trimmed some of their excessive short bets against it after some weak eurozone data this week. While expectations of a U.S. rate pause have manifested in money markets, bets on policy tightening by other major central banks have also receded, giving a boost to the dollar.
  • Prime Minister Theresa May's Brexit deal was defeated in parliament on Tuesday but she won a subsequent vote of confidence, which has removed some political uncertainty. Analysts have interpreted this week's events as reducing the risk that the country will fail to strike a deal with European Union before it leaves the bloc on March 29.

Global Markets

  • Oil prices rose over 1 pct on Friday after a report from the Organization of the Petroleum Exporting Countries (OPEC) showed its production fell sharply last month, easing some fears about prolonged oversupply.
  • Gold slipped to the lowest in more than a week on Friday as hopes of a thaw in the U.S.-China trade dispute perked up stock markets, while palladium held above $1,400 on a supply crunch.

Global Markets at one Glance

Markets at 5.00pm In INR % Change
USD/INR 71.19 71.19 0.14
EUR/USD 1.14063 81.16 0.3
GBP/USD 1.29396 92.05 -0.19
USD/JPY 109.483 0.65 -0.09
SEK/INR 8.9939 7.9154 0.0433
DKK/INR 6.342 11.2250 0.49
AUD/USD 1.3904 51.17 0.35
DXY 96.014 -0.05
Index Today % Change
NIFTY 10906.95 0.02
SENSEX 36386.61 0.03
NIKKEI 20666.07 1.29
HANG SENG 27090.81 1.25
SHANGHAI 2596.0056 1.42
CAC# 4870.56 1.59
FTSE # 7264.61 0.0042
DAX # 11069.64 1.38
Commodities Today % Change
GOLD # 1285.11 -0.49
SILVER# 15.467 0
BRENT # 61.87 1.13
NYMEX # 52.75 1.31
Today Today
OPEN 71.0650
HIGH 71.2325
LOW 71.1800
CLOSE 71.0625

Key Events of the Day

Date Time Currency Event Actual Forecast Previous
18-Jan-19 15:00 GBP Retail Sales (MoM) (Dec) -0.9% -0.8% 1.3%

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