Thursday, April 18, 2019

INR update: Improving Chinese data plus US China trade deal hopes drive sentiments



Chinese data (GDP, IIP) released yesterday added to the optimism around the dragon economy after its surprise export growth last week. US Beige Book reading does not change the luke warm outlook on the US economy although the real information would be the retail sales print later during the day. US retail sales would set the risk sentiments either way for the markets.

USDINR 1m NDF is trading 5p right while CNH has appreciated on the back of hopes that US-China trade deal could be sealed by as early as next month. The inflow expectations are digested while the real price action is awaited. The break of 69.50 on Tuesday is convincing and this should now take the pair towards 69.85 levels, the risk to this view is one of the talked about inflows hitting the markets. CMP 69.45, Range 69.37-69.69.



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