9th August: Indian rupee report for exporters and importers

Insignia Consultants

New Delhi

www.insigniaconsultants.in

 

Thursday, August 09, 2012

 

 TIME 11:30 AM IST                          

 

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INDIAN RUPEE REVIEW AND OUTLOOK

 

There is position squaring and rebuilding for next week for the rupee (usd/inr). Demand from state run oil companies is still there which is preventing rupee from falling below 55.10 against the US dollar. Rupee would have weakened much more but for a weaker US dollar.  Moody has lowered Indian growth forecast at 5.50%. This already been factored in by the markets and its impact will be short lived. There is speculation that government will announce disbursement of free telephones and free calls to people below poverty line on August 15 and it will entail additional expenses of over 7000 crores. These measures will only increase the fiscal deficit and prevent rupee from sharp gains. Foreign direct investors will be further cautious of investing in India if this measure is announced. We expect the rupee to depreciate to 56.80 -57.75 if this measure is announced.

 

 

USD/INR

55.42 is the key resistance and as rupee can fall to 54.98-54.75 as long as it trades below 55.42.

 

Key support: 54.94

Key resistance: 55.42

 

Exporters: Use a trailing stop loss of 54.80 on the near term receivables.

Importers: Use a trailing stop loss of 55.70 for the near term payables.

 

EURO/INR

 

Euro-rupee can fall to 67.98 and 67.90 as long it trades below 68.48. There will be a technical break out on higher side only over 68.48 to 68.76-69.06.

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Exporters: Use a trailing stop loss of 67.80 on the near term receivables.

Importers: Use a trailing stop loss of 69.10 for the near term payables.

 

Forward Premiums

 

One year forward premiums can fall to 321 paisa from the current 326 paisa while near dated forward premiums should rise.

 

 

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Disclaimer: Any opinions as to the commentary, market information, and future direction of prices of specific currencies, metals and commodities reflect the views of the individual analyst, In no event shall Insignia Consultants or its employees  have any liability for any losses incurred in connection with any decision made, action or inaction taken by any party in reliance upon the information provided in this material; or in any delays, inaccuracies, errors in, or omissions of Information. Nothing in this article is, or should be construed as, investment advice.

NOTES TO THE ABOVE REPORT

PLEASE NOTE: HOLDS MEANS HOLDS ON DAILY CLOSING BASIS

ALL PRICES IN INDIAN RUPEES UNLESS OTHERWISE SPECIFIED

 

 

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