Thursday, 26 March 2015 12:11

Why Rupee Gain In January 2014?

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In last 5 working days Rupee gain 0.46% against Dollar. There are many internal and external factors which has driven Rupee this week.

Following are the reason for Rupee movement:

  • Inflation data is expected to be positive this month prior on December 2013.
  • Till India National election in May, Rupee is expected to keep uptrend.
  • Domestic market failed to support Rupee this week, decline in Sensex index 346 points.
  • Since 1 January 2014, we have received 275.85 Million USD in India from FII route.
  • Custodian bank was the major sellers of USD.

In FOMC Meeting Minutes, Fed has no clarity on future tapering plan and focus on Unemployment target at 6.5%. We had many other important data in U.S this week like ISM manufacturing PMI read 53.0 prior 53.9, ADP NFP read 238K prior 229K and unemployment claims read 330K prior 345K. Today we had Indian exports for December 13 which rose 3.5% and Indian Imports for December 13 which decline by 15.3%. Industrial Production data is expected 0.8% prior -1.8% today at 5:30 pm. The positive economic data may support Rupee for short term.

However, marketer must watch Inflation data on 13 January, which will directly affect Forex market.

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