Currencies Daily Report
Monday, May 16, 2016
Content
Market highlights
US Dollar Index
Indian Rupee
Euro
Sterling Pound
Japanese Yen
Economic Indicators
Heena Imtiaz Naik
Research Associate
Currency
Heena.naik@angelbroking.com
(022) 2921 2000 Extn :6104
Harsh Rawat
Technical Analyst
Currency
harsh.rawat@angelbroking.com
(022) 3935 8141
Prathamesh Mallya
Sr. Research Analyst
Non-agro Commodity & Currency
prathamesh.mallya@angelbroking.com
(022) 2921 2000 Extn :6134
Kaynat Chainwala
Research Analyst
kaynat.chainwala@angelbroking.com
(022) 2921 2000 Extn :6136
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Currencies Daily Report
Monday, May 16, 2016
MARKET HIGHLIGHTS
 US Retail Sales surged by 1.3 percent in Apr’16
 Euro-zone’s Flash GDP for q/e Mar’16 plunged by 0.5 percent
 China’s Industrial Production plunged to 6 percent in Apr’16
Asian markets are trading mixed owing to less cheering economic data
release from China over the weekend. Moreover, recent statement by
the Japanese FM to intervene in the currency market if strength in yen
persisted for long led to volatile trading in the global markets.
US DOLLAR INDEX
The Dollar Index traded higher by 0.5 percent in the last week as
markets discounted the statement made by Charles Evans, president
of the Chicago Fed. He said that America’s economic fundamentals
were solid and growth this year should pick up to around 2.5 percent.
However, there are some weak spots in capital spending hence
continuation of wait and watch policy with respect to US interest rates
would be appropriate.
He also said that a temporary overshoot in inflation so as to lift
consumer price growth up to the Fed's longer-term target of 2 percent
and raise overall inflation expectations from current low levels is
welcome. All the above statements acted as a positive factor for the
greenback.
Market Highlights (% change)
Last
as on May 13, 2016
Prev.
day
INDIAN RUPEE (USD/INR)
The Indian Rupee depreciated by 0.2 percent in the last week led by
outflows of funds in the domestic market amid negative sentiments in
the global markets. Moreover, fresh buying of the American currency
by importers and banks amid stronger dollar in the overseas market
dragged the rupee further lower.
MoM
YoY
NIFTY
7814.9
-1.08
-0.7
#N/A
-3.8
SENSEX
25489.6
-1.17
-0.8
#N/A
39.4
DJIA
17535.3
-1.05
-1.2
-2.6
-4.0
S&P
2046.6
-0.8
-2.7
-0.6
-2.9
FTSE
6138.5
0.6
-64.8
-3.4
-12.0
KOSPI
1967.0
-0.1
-0.5
-2.4
0.9
BOVESPA
58497.8
0.2
13.1
10.6
4.1
NIKKEI
16412.2
13.4
-0.1
-2.6
88.1
Nymex Crude $/bbl
Comex Gold - $/oz
46.21
-1.0
6.4
11.3
-22.8
1280.00
0.6
1.1
2.2
4.5
Comex Silver - $/oz
17.09
-1.2
-2.4
5.2
-2.1
LME Copper (3
month) -$/tonne
G-Sec -10 yr @7.8%
- Yield
4627.50
0.3
-1.2
-22.6
-27.7
100.94
-0.2
-0.2
#N/A
-1.9
Source: Reuters
US Dollar (% change)
US Dollar Index made a weekly high of 94.85 and closed at 94.59 on
Friday.
WoW
as on May 13, 2016
Last
Prev.
day
WoW
MoM
YoY
Dollar Index
94.59
0.5
0.5
-0.1
19.1
US $ / INR (Spot)
66.85
-0.1
-0.2
-0.4
-5.2
US $ / INR May’16
Futures (NSE)
US $ / INR May’16
Futures (MSE)
66.83
0.08
0.7
0.20
4.93
66.82
0.06
0.7
0.23
4.93
Source: Reuters
Technical Chart – USD/INR
Domestic markets i.e. Sensex and Nifty ended on a positive note after
Rajya Sabha passed a new bankruptcy code to address corporate
debts and improve the ease of doing business. Moreover, recently
released UN report stated that despite delay in domestic policy
reforms, India’s economy has been gaining momentum slowly and is
projected to grow by 7.3 per cent in 2016.
The currency made a weekly low of 66.91 and closed at 66.85 on
Friday.
OUTLOOK
From the intra-day perspective, Rupee is likely to depreciate owing to
weak trend seen in the Asian markets after the disappointing release
of important economic data sets from India and China.
Source: Telequote
Technical Outlook
valid for May 16, 2016
Trend
US Dollar/INR May’16 (NSE/MSE)
Support
Resistance
Sideways 6676/66.60 67.09/67.25
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Currencies Daily Report
Monday, May 16, 2016
EURO (EUR/USD)
Euro weakened by 0.7 percent in the last week after the European
Union's statistics agency showed fall in the industrial production greater
than anticipated 0.8 percent in March. Moreover, in a recent Reuter’s
poll according to some economists, Euro-zone’s economic growth will
lose momentum after a strong start to 2016 if Britain leaves the
European Union.
Moreover, Greece's economy contracted by 0.4 percent in the first
quarter compared to the last three months of 2015, a flash estimate by
the country's statistics service ELSTAT showed on Friday.
Euro (% change)
as on May 13, 2016
Last
Prev. day
WoW
MoM
YoY
Euro /$ (Spot)
1.1305
-0.6
-0.7
0.3
-0.9
Euro / INR (Spot)
75.57
0.5
0.5
-0.7
-4.3
Euro / INRMay’16
Futures (NSE)
76.21
0.09
1.0
0.70
8.78
Euro / INRMay’16
Futures (MSE)
76.22
0.10
1.0
0.63
8.76
Source: Reuters
Technical Chart – EUR/INR
The shared currency made a weekly low of 1.1373 and closed at 1.1305
on Friday.
OUTLOOK
Euro is expected to trade lower after the European Union's statistics
agency revised down the annual GDP estimate to 1.5 percent from 1.6
percent in the first quarter of the year.
Technical Outlook
valid for May 16, 2016
Trend
Euro/INR May’16 (NSE/MSE)
Sideways
Support
75.84/75.67
Resistance
76.16/76.32
Source: Telequote
STERLING POUND (GBP/USD)
GBP (% change)
Sterling pound fell by 0.3 percent in the last week after the BoE officials
kept the key interest rates unchanged at 0.50 percent citing weak
consumer spending and low investments by companies as they want to
play safe prior to the so-called Brexit on June 23.
Moreover, the committee also warned the side-effects of Britain leaving
the Euro-zone like sharp fall in Cable and employment opportunities.
The BoE Governor has called Brexit the biggest domestic risk to British
financial stability.
The currency made a weekly low of 1.4404 and closed at 1.4361 on
Friday.
as on May 13, 2016
Last
Prev. day
WoW
MoM
YoY
$ / GBP (Spot)
1.4361
-0.58
-0.3
1.5
-9.0
GBP / INRMay’16
Futures (NSE)
96.84
0.39
1.53
0.79
-0.86
GBP / INRMay’16
Futures (MCX-SX)
96.84
0.45
1.61
0.85
-0.80
Source: Reuters
Technical Chart – GBP/INR
OUTLOOK
Sterling Pound is expected to trade sideways as lack of important
economic data release from the nation wills prompt the traders to focus
on the last week’s BoE meeting outcome.
Technical Outlook
valid for May 16, 2016
Trend
GBP/INR May’16 (NSE/MSE)
Sideways
Support
96.35/96.19
Resistance
96.66/96.83
Source: Telequote
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Currencies Daily Report
Monday, May 16, 2016
JAPANESE YEN (JPY/USD)
JPY (% change)
Japanese Yen depreciated by 0.3 in the last week. Last week BoJ
governor spoke on a number of important factors that were troubling
the Japanese economy. He confirmed that overseas economic
developments were risking Japan’s economic outlook. Sluggish global
demand has affected Japan's consumption pattern too. Low consumer
spending has failed to spur the inflation rate.
as on May 13, 2016
Last
Prev
day
WoW
MoM
YoY
JPY / $ (Spot)
108.6
-0.38
0.3
-0.7
-8.8
JPY 100 / INRMay’16
Futures (NSE)
JPY 100 / INR May’16
Futures (MSE)
61.20
-0.35
0.91
3.05
14.69
61.20
-0.40
0.86
3.72
14.63
Source: Reuters
However, he is still optimistic that Japan will come out of this turmoil.
The governor expects overseas economy to rebound thereby helping
Japan to make amends with growth. Inflation expectations are likely to
follow increasing trend however the authorities won't hesitate to act if
2 percent CPI is seen endangered.
Technical Chart – JPY/INR
The currency made a weekly low of 109.49 and closed at 108.6 on
Friday.
OUTLOOK
Japanese Yen is expected to trade lower as Japan’s FM Taro Aso said
that in order to protect Japan’s trade and economy; BoJ would be
ready to intervene in the currency market if strength in Yen continues
for long.
Technical Outlook
valid for May 16, 2016
Trend
JPY/INR May’16 (NSE/MSE)
Source: Telequote
Sideways
Support
61.31/61.15
Resistance
61.63/61.79
Economic indicators to be released on May 16, 2016
Indicator
Empire State Manufacturing Index
Country
Time (IST)
Actual
Forecast
Previous
Impact
US
6:00pm
-
-
9.6
Medium
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