Last week rupee appreciated by 0.34 percent as dollar index weakened by 1.6 percent. The strength in rupee can be attributed to IMF’s projections of growth in Indian GDP at 7.4% for 2018 and 7.8% for 2019. The growth forecast is the highest for any major growing economy. Also, Indian equity market remained positive during the week with a surge of around 1.37 percent in Nifty Index.
The factors driving dollar index down were US treasury secretary’s comments at the ongoing Davos summit in Switzerland in which he welcomed a weaker dollar as weakness in dollar helps US in their trade opportunities. The flash manufacturing PMI from US came in line with market expectations of 55.5 in Dec’17 and the services PMI came lower than estimates at 53.3 as compared to 54.5 in Dec’17. Also, advance quarterly GDP for Q4 2017 comes in at 2.6% which was lower than market expectations of 3%.
USDINR is expected to move sideways in the coming session
EURUSD appreciated by 1.7 percent while EURINR depreciated by 1.25 percent during the same time frame.
Euro had appreciated as ECB spokesperson had commented on cutting down the 2.55 trillion Euro monetary stimulus program in 2018. However, in the recently concluded meeting ECB kept interest rates unchanged but they were optimistic about inflation in the Euro area. Also, Euro Area flash services PMI came in better than market estimates at 57.6 in Dec’17 as compared to 56.5.
EURINR is expected to move sideways in the coming session
GBP appreciated against the US dollar by 3.00 percent last week while GBPINR depreciated by 2.63 percent during the same time period.
Public sector borrowing for UK came in at 1.02 billion pound which less than market estimates of around 4.2 billion pounds for Dec’17. However, average earnings index for Dec’17 came in line with market expectations at 2.5% in Dec’17. Also, unemployment rate in UK for Dec’17 came in line with market expectations at 4.3%.
GBPINR is expected to appreciate in the coming sessionAFTER POST CONTENT
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