DM bond yields continue to rise as equity markets start
showing nascent signs of concern on account of central banks withdrawal
rhetoric. US ISM services was a strong number along with US manufacturing ISM
released on Monday. These two numbers make me think that the US economic
activity in June has picked up as compared to Apr-May and that could lead to
upticks in inflation numbers driving bond yields further higher. Today in the
NFP release, I would focus on the average hourly earnings more than the
headline print.
EM currencies have taken a breather since yesterday evening
while Asian equities trade mildly in the red. USDINR 1m NDF is 2p left only. I
would think that there are a lot of USDINR shorts running in the market as
people don’t expect the range top of 64.90 to be broken. But at the same time
these shorts would look to exit near 64.60 levels making that a strong support
now. I would continue to advise buy on dips for USDINR expecting 64.90 to break
for 65.20 in the next 2-3 sessions otherwise a reversal would be due. CMP
64.73, Range 64.67-67.89.
No comments:
Post a Comment