The import tariff put on washing machines and solar panels by Trump, reinforced the soft dollar policy of the US. Plus the fact that Robert Mueler has shown intent to question Trump is not going to do the USD any good either. The trade protectionism stance of the US could get reinforced in the ongoing WEF meet in Davos and consequently reflect in global currencies this week itself. Trump speaks in Davos on Friday 26th Jan at 6-30PM IST.
USDINR 1m NDF is trading 3p left while EM currencies have appreciated mildly since yesterday including KRW and CNH. Equity inflows have picked up and there seems to be significant FDI flows in the pipeline as well. Before the budget the bond market is showing increasing signs of confidence in the government’s ability to control the fiscal deficit within a respectable number for FY19. Given the backdrop of dollar weakness, RBI might now allow INR to appreciate before the budget on 1st Feb. A daily close below 63.55 will open the way for 63.25. CMP 63.65, Range 63.55-63.73.
No comments:
Post a Comment