Rupee - June 25, 2021 - Reliance Securities

Mr. Sriram Iyer, Senior Research Analyst at Reliance Securities

The Indian Rupee depreciated for the fourth straight week against the U.S. dollar on increased dollar demand from oil companies amid a persistent rise in crude oil prices.

The Rupee ended at 74.20 compared with 74.16 in the previous session. The unit fell 0.5% this week, adding to an aggregate near 2% weakness in the last three weeks.

Apart from crude oil prices, the major talking point of the market throughout the week was the outlook of the Federal Reserve's monetary policy.

Fed Chairman Jerome Powell downplayed the inflation threat and reiterated the U.S. central bank's commitment to the broad labour market recovery.

Statements from other Fed official were mixed. Some of them were dovish like NY Fed President Williams who said that U.S. economy still far from maximum employment, not the time to lift rates and capped downside of bullion.

However, Federal Reserve Bank of Atlanta President Raphael Bostic said the central bank could decide to slow its asset purchases in the next few months and he favoured lifting interest rates in 2022 in response to a faster-than expected recovery from Covid-19 pandemic. This was deemed slightly more hawkish.

Meanwhile, traded in a narrow range this Friday. Supports are at 74.00 and 73.88. Resistances are at 74.25 and 74.40.

In the international markets, technically, the Dollar Index supports are at $91.55 and $91.30. Resistances are at $92.00 and $92.30.

Conclusion: The underlying short term trend of Nifty continues to be positive with range bound action. The market is now placed to show upside momentum above the hurdle of 15900 levels in the coming few sessions. A sustainable move above this area could open further upside towards 16200 in the near term. Immediate support is placed at 15770.

Source : Equity Bulls

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