India Forex - Forex Trading in India

India Saturday 6 March 2010 - The Rupee completed a fourth weekly advance, the longest winning streak since October, on speculation exporters will convert overseas earnings to reduce foreign-exchange losses as the local currency appreciates.

The currency touched the highest level in six weeks after Finance Minister Pranab Mukherjee pledged in the Budget to cut the deficit to 5.5% of gross domestic product in the year beginning April from a 16-year high of 6.7% this year.

The rupee strengthened 1.1% this week, the most in such a period since January, to 45.61 per dollar. It reached 45.605 earlier, the strongest level since January 19. The rupee has gained 2% so far this year, the third-best performance among the 10 most-active Asian currencies outside of Japan.

Offshore contracts indicate bets the rupee will trade at 45.65 to the dollar in a month, compared with expectations of 46.20 at the end of last week. Forwards are agreements in which assets are bought and sold at current prices for future delivery. Non-deliverable contracts are settled in dollars rather than the local currency.

EUR/USD : The EUR/USD bias remains neutral in nearest term and the major bearish scenario remains intact. The hourly to daily charts are highly oversold hence in correction mode and retracements towards 1.3640-1.3700 is expected. Selling may not be initiated fresh. Look at higher levels to book exports and short term importers may cover and medium term exp! orters may wait for covers. (EURUSD - 1.3590).Neutral but Oversold.

GBP/USD : The GBPUSD bias remains neutral to bearish in nearest term and we are seeing continuous fall since last 2-3 days due to fundamental forces driving the currency despite resilience in EUR/USD. We may see some upward correction till 1.5390-1.5490 levels where cautious shorts could be initiated. Please note that the weekly and daily charts are oversold and correction seems to be long due. Importers may book covers for short term at 1.51-53 levels. (GBPUSD ? 1.5289).Neutral but Oversold.

USD/JPY :USDJPY is currently trading at 89.30 levels. Upside correction may happen till 92-93 levels. Importers in Yen may look at covers around these levels (weekly trendline). Overall the trend remains strong for yen below 93 levels. (USDJPY- 89.65). Bullish.

AUD/USD : AUDUSD is currently trading at 0.8880 levels. Correction seems to be over for Australian dollar and up move again resumed. Buying on dips remains the strategy. Further bullishness till 0.9000 levels is expected again. (AUDUSD - 0.8880) Bullish.

Gold ! : Gold’s moved up taking support from $1087 levels and holding above $1100 levels. Buying at dips close to 1080-90 levels remains the strategy. (Gold-$1107). (Rangebound to slightly bearish).

Dollar Index : Dollar index has looks to be in slight correction mode and dips around 79.56 levels ! are possible. Nevertheless, such consolidations should be relatively brief as long as 79.56 cluster supports holds (38.2% retracement of 76.60 to 81.34 at 79.52). Break of 81.34 will bring rally resumption towards 82.63 medium term resistance next. Medium term view remains bullish. Buying on dips on the index remains the strategy. (Dollar Index ? 80.60). Bullish above 80 levels.

India Saturday 6 February 2010 - The International Monetary Fund or IMF has projected India’s economic growth for the fiscal 2010-11 at 8%, and 6.7% for current fiscal. It attributed India’s prompt fiscal and monetary easing along to fiscal stimulus of the government to the speedy recovery from global meltdown.

Although the agricultural output for the current fiscal is estimated to be less by 1% due to drought, the non-agricultural GDP growth is likely to increase. It foresees more jobs increasing private consumption.

Investments are likely to improve with boosting corporate profits, rising business confidence and favorable financing conditions. The acceleration pace of reforms and capital inflows also could raise investment.

The IMF said that with India’s long-term prospects remaining strong and the private sector balance-sheets sound, it expected growth to be back at potential 8% in 2010/11, even if advanced economies grew below trend. It added that medium-term growth prospects remained bright.

It cautioned the main risks that India was facing were the rising inflation and the financing constraints arising out of ballooning fiscal deficit. It also included risks like asset price bubbles and a sudden halt in capital inflows caused by turmoil in global financial markets.

India Monday 1 February 2010: The country’s fourth largest software exporter HCL Technologies today said volatility in rupee’s exchange rate is a major challenge for the company.

“We see a lot of traction and a lot of deal flow happening in the marketplace led by operating efficiency and cost saving steps…. We definitely see exchange rate as one of the challenges, company CFO Anil Chanana told.

Most of the Indian IT companies earn a big chunk of its income from abroad in foreign currencies and the rupee’s value against the dollar is vital for them. A stronger rupee is not beneficial to any exporter including software exporters like HCL and the rupee has appreciated 3-5 per cent in the last two quarters.

He, however, said as far as the net income is concerned the company in the next 8-9 months would be indifferent to the exchange rate, the value of the rupee vis-a-vis US dollar which is susceptible to many factors in the forex market.

India Saturday 23 January 2010: The rupee fell for the fourth day on Friday, but pulled back from a two-week low, struck early as exporters sold dollars in belief that the drop in the rupee was overdone. The local currency closed 0.2% weaker at 46.15 against the dollar from the previous day’s 46.04. For the week, it fell around 0.8%.

“We don’t expect RBI to explicitly discuss the use of rupee appreciation as a tool for stemming inflation expectations, but given the central bank’s practice of remaining on the sidelines in recent months (as indicated by the simultaneous rise in inflows and slowdown in reserves accumulation), we believe that the market will continue to see RBI refraining from intervention (sterilised or otherwise) as long as food price inflation remains high,” said Taimur Baig, chief economist of Deutsche Bank, in a report to clients.

Dealers said the rupee could gain towards 45.70 as charts indicate a dip in the dollar. Traders now await the central bank’s policy review on January 29. Economists are widely expecting the central bank to raise banks’ cash reserve requirement. The yen surged against the dollar and the euro on Friday as a break of key support triggered stop-loss sales, while the risk appetite towards emerging market assets due to the White House’ proposals to regulate US banks. The euro tumbled to a nine-month low of after breaching a long-held chart support.

India Tuesday 19 January 2010 : The rupee firmed up by six paise to 45.57/58 against the US Dollar in the early trade today on sustained selling pressure from bankers and positive cues from the regional stock markets, traders at the Interbank Foreign Exchange (Forex) said here.

Later, the local unit flucutated in a narrow range between 45.55 and 45.62 in the intra day trade. It was trading firm at 45.61 against the greenback.

Dealers said the partially-convertible rupee could rise during the day.

”I expect it to open at the same level tomorrow and remain strong. If oil prices fall to USD 75-76 level, it may add to the rupee’s strength,” said a dealer at a private sector bank.

The Foreign exchange rates in India are updated daily from the data as published by Reserve Bank of India. It covers the currencies – US Dollars, GB Pounds, Euro & Yen.

Closing Forex Rate for the last five days:

India Monday 21 December 2009 : Following are the indicative currency notes and travellers’ cheques buying and selling rates per unit as given by Thomas Cook India here today.

(Figures in Rupees) ——————— Currencies Buy Sell US Dollar 44.05 49.25 Sterling Pound 71.45 79.30 Euro 63.10 70.35 Australian Dollar 39.65 43.70 Bahrain Dinar 115.90 132.05 Canadian Dollar 40.75 45.85 Danish Kroner 08.25 9.60 Egyptian Pound 06.15 08.85 Hong Kong Dollar 05.50 06.55 Japanese Yen/100 48.35 53.80 Jordan Dinar 58.60 67.90 Kuwait Dinar 138.70 165.25 Malaysian Ringgit 12.20 14.80 New Zealand Dollar 30.60 35.35 Norwegian Kroner 07.35 08.50 Omani Rial 113.40 129.05 Qatar Rial 11.95 13.70 Saudi Rial 11.60 13.40 Singapore Dollar 30.50 35.75 South African Rand 05.45 06.55 Swedish Kroner 05.90 06.85 Swiss Francs 42.05 48.40 Syrian Pound 00.35 01.10 Thai Baht/100 129.40 152.50 UAE Dirham 11.90 13.50 Chinese Yuan 05.00 07.75.

India Monday 16 November 2009 : The fact that World Bank President Robert Zoellick has said that China’s yuan may become the global reserve currency over the next 15 years assumes
significance not just for the world but also for India. It has the potential to make Indian goods relatively more competitive as the Chinese currency today is highly controlled.

This is not the first time Zoellick has spoken of such a possibility and the buzz about China trying to position the yuan as a reserve currency of the future has been on for some time now. This is not a situation that will occur in the short or medium term, but surely a prospect over the time frame that Zoellick is talking about.

With bilateral trade between the two Asian giants estimated at around $41 billion in 2008-09, China has now become India’s largest trading partner. The trade, however, continues to be lopsided. Exports from India are valued at about $9.7 billion while imports are as high as $31.33 billion.

No wonder India’s Ambassador to China S. Jaishankar recently made the point that it was strange Indian manufactured products were competitive globally but not within China. Clearly, there are growing concerns not only over the trade deficit but also over the fact that most of India’s exports to China are commodities while imports are mainly manufactured goods.

The fact that Chinese goods are more competitive than the rest of the world is also being attributed partially — though not wholly — to the fact that the yuan has not been allowed to float freely against other currencies, primarily the dollar. In case a free float was allowed, it would be bound to appreciate and this would naturally make its products less expensive.

India Tuesday 10 November 2009 : Following are the indicative currency notes and travellers’ cheques buying and selling rates per unit as given by Thomas Cook India here today.

(Figures in Rupees) ——————— Currencies Buy Sell US Dollar 43.75 48.90 Sterling Pound 73.60 81.65 Euro 65.35 72.90 Australian Dollar 41.10 45.30 Bahrain Dinar 115.00 131.05 Canadian Dollar 40.80 45.90 Danish Kroner 08.55 09.95 Egyptian Pound 06.15 08.85 Hong Kong Dollar 05.45 06.50 Japanese Yen/100 48.20 53.65 Jordan Dinar 58.25 67.45 Kuwait Dinar 138.10 164.55 Malaysian Ringgit 12.35 14.95 New Zealand Dollar 31.65 36.60 Norwegian Kroner 07.60 08.85 Omani Rial 112.60 128.15 Qatar Rial 11.90 13.60 Saudi Rial 11.55 13.30 Singapore Dollar 30.60 35.85 South African Rand 05.50 06.65 Swedish Kroner 06.20 07.20 Swiss Francs 43.15 49.60 Syrian Pound 00.35 01.05 Thai Baht/100 128.15 151.05 UAE Dirham 11.85 13.40 Chinese Yuan 04.95 07.70.