Seema Yadav
Research Analyst, IndiaNivesh
Dollar/Rupee had a volatile day yesterday and after hitting a day low 70.8325 saw recovery towards 71.2650 then retreated towards 71.13 levels as speculation Brexit was kept indecision in the entire Forex market. A low was seen day after People’s Bank of China further eased reserve ratio cuts in order to increase liquidity in its economy.
Technical, USDINR breached its immediate resistance 71.05 and tested first predicted level of 71.25. However, retreated again towards 71.15. Intraday price action resulted in the formation of long bullish candlestick and pair remained above its short term consolidation resistance both of which are yet indicating for bullishness and pair expects to test 71.55 very soon. On the downside, support is 71.05-70.70.
Major Economic Data & Events Released Yesterday/Earlier today
Eurostat said on Tuesday that the trade surplus of the 19-nation eurozone was 19.0 billion euros ($21.7 billion) on a non-seasonally adjusted basis, down from 23.4 billion euros in November 2017.
The Chinese central bank slashed the Reserve Requirement Ratio (RRR) by 0.5% today and will cut rates by another 0.5% on Jan 25, 2019. Tuesday, the PBOC injected 80 billion yuan ($11.86 billion) through 7-day reverse repos and 100 billion yuan through 28-day tenor, while a batch of 390 billion yuan worth of one-year MLF was set to mature on the same day.
Japan orders from manufacturers fell 6.4 percent in November from October after a 12.3 percent increase in October, due to a decline in orders from manufacturers of electronics and steel.
