The markets focussed on the strong headline NFP and ignored the disappointing wage growth number consequently taking the US2Y yield higher by 2bps. This is the week of inflation data with EU countries, US and India releasing their CPIs. In terms of positioning EUR longs are at the highest since 2014 while JPY shorts still have further room. A lot of GBP shorts have been unwound so depending on incremental data GBP shorts might yield positive returns.
USDINR moved against my expectations on Friday probably on the back of an inflow. Today morning KRW appreciation triggered stops in USDINR longs taking the pair towards 64.50. Risk sentiments have improved since Friday morning as Asian equities trade in green. Technically USDINR faces tough support in the 64.40-64.45 zone and a daily close below 64.40 can take the pair towards 64.20, although that is not what I would expect. CMP 64.51, Range 64.45-64.58.
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