Rupee - Dec 21, 2021 - Reliance Securities

Mr. Sriram Iyer, Senior Research Analyst at Reliance Securities

The Indian Rupee appreciated afamins the U.S. Dollar on Tuesday as investors continued to unwind their long dollar positions and a recovery in local equities also helped.

The Rupee ended at 75.60, its stronger since December 9, compared with 75.91 close in the previous session.

The unit had briefly strengthened to an intraday high of 75.41 earlier in the session on dollar sales but erased some gains as importers covered their unhedged positions.

The currency was also aided by speculation that the Reserve Bank of India may have stepped in to calm volatility in the market.

Meanwhile, India's benchmark BSE Sensex climbed 0.9%, while most EM and Asian currencies were stronger this Tuesday afternoon trade and aided sentiments.

Indian government bond yields rose on Tuesday aided by moves by the central bank to squeeze out banking system liquidity.

The benchmark 6.10% bond ended at 6.47%, its highest closing level since Apr. 13, 2020, and compared with 6.44% close in the previous session.

Technically, the USDINR Spot pair has given a breakdown below 75.70 levels and a sustained trade below could pull the pair to the support zone at 75.45-75.30 levels. Resistance zone is at 75.70-75.92 levels.

The USDINR Spot pair could trade in a range of 75.45-75.70 levels in coming session.

The U.S. Dollar was trading marginally in the red this early Tuesday in the European session ahead of key PCE price index and U.S. GDP data due this week.

Technically, if the Dollar Index trades above $96.30 level, it could continue a bullish momentum up to $96.50-$96.80 levels. Support zone is at $96.20-$96.12 levels.

The Euro and the Sterling rebounded against a softer dollar this Tuesday in the European session lifted by a rebound in global risk appetite.

The Japanese Yen was trading weak this Tuesday in late Asian session.

Source : Equity Bulls

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