Monday, 06 April 2015 08:33

Rupee this week

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Rupee opened a bit low at 61.93 after last week closing of 61.78 as U.S. non-farm employment changed more than expected.

The currency remained in range of 61.90 to 62.0 in morning trading hours. Compare to INR, other emerging market currencies have depreciated more against dollar. Dollar index that measures the performance of dollar against six major currencies reached near to five year high at 89.46 on Friday but little changed today to 89.36.Dollar is trading at seven year high against Yen at 121.45 and against EUR it advanced to 1.2281 today.

This week we may see INR movement within the same range of 61.80 to 62.20. Upcoming U.S. economic data of Retail Sales, Core Retail Sales and Consumer Sentiment are expected remain either unchanged or slightly positive. On Thursday ECB is to hold second round of TLTRO that may weaken EUR and indirectly rupee as well. ECB president Draghi disappointed market by not announcing quantitative easing in last meet and waited for the next round to turn the final card.

Coming election at Japan on Dec14 may further weaken yen as chances of winning of present P.M. Abe is high. To retain the hold over the introduced economic reforms the P.M. announced snap election last month. Strengthening of dollar against yen may also weaken INR next week.

On Friday India is to release CPI, Industrial production and Manufacturing Output data after market hours. Both CPI and Industrial Production are expected to show bit negative reading this time. We may see its impact on currency in next week.

There seems upside pressure near to the level of 62.0-61.98/99 not letting the currency to depreciate further. We may not see major movement in rupee due to economic data release in this week and expecting it to trade within prescribed range.


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