Equities gained in the US and a closing on Dow at 25709, technically makes the index looks like heading towards the highs of 26600 again. Currency markets lack direction and continue to trade sideways. If Powell today does not deliver a hawkish surprise then markets might revert to the major theme of dollar weakness, driving dollar index towards 88.5 again (CMP 89.81).
In USDINR we continue to see a lot of bids since yesterday and the fact that NDF 1m is trading 4p right makes be infer that the buying is NDF led. The buying in USDINR seems disconnected from KRW while the correlation with CNH was broken a couple of months back. On the other hand a dollar weakness led daily close below 64.70 could bring in 64.40. For the day CMP 64.85, Range 64.75-64.95
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