Last Updated on: 26/06/2024
TODAY: Wednesday, 26th June, 2024
USD/INR:
The Indian rupee is expected to open largely unchanged on Wednesday, focusing on the expiry of monthly currency futures and the upcoming inclusion of Indian bonds in the JPMorgan emerging market debt index.
Non-deliverable forwards indicate the rupee will open nearly flat to the U.S. dollar from 83.4325 in the previous session.
The expiry of the NSE June USD/INR monthly futures at 12.30 p.m. IST may potentially prompt choppy price action in the rupee, dealers said.
The Reserve Bank of India (RBI), in its bid to support the rupee, had sold June USD/INR currency futures, which it later likely rolled over to July.
In lieu of the intervention, banks had done arbitrage by buying the June currency futures and selling them in the over the counter (OTC) market. The sold positions in the OTC market will need to be squared off at the RBI's daily fixing rate.
The June currency futures are settled at the daily fixing rate.
"Due to this, there was a lot of action yesterday for today's fixing," a currency trader at a bank said. The Wednesday fix was dealt at a premium of 0.30 paisa, he said, indicating demand for buying dollars at the fix rate.
Meanwhile, the rupee is expected to be supported all through this week amid expectations of dollar inflows from India's inclusion into the JPMorgan emerging market debt index on June 28.
MAJOR WORLD CURRENCIES:
USD:
The U.S. dollar rose on Tuesday, bolstered by hawkish comments from Federal Reserve officials as well as data showing a stable housing market in the world's largest economy, both suggesting that the central bank will not be in a rush to kickstart its rate-cutting cycle.
The greenback firmed against the euro, yen, Swiss franc, and commodity currencies, such as the Australian and New Zealand dollars.
Fed Governor Michelle Bowman started the ball rolling for the dollar, repeating her view on Tuesday that holding the policy rate steady "for some time" will likely be enough to bring inflation under control. She also reiterated her willingness to raise borrowing costs if needed.
Fed Governor Lisa Cook, for her part, said it would be appropriate to cut interest rates "at some point" given significant progress on inflation and a gradual cooling of the labor market. She remained vague, however, about the timing of the easing.
"They sound very non-committal and ... also very data-dependent, given the uncertainty around the inflation outlook that is higher in the U.S. than elsewhere around the world."
U.S. data was mixed on Tuesday, still allowing the dollar to hold its gains.
A report showed U.S. single-family home prices increased at a steady pace in April, rising 0.2% on the month after being unchanged in March. In the 12 months through April house prices increased 6.3% after advancing 6.7% in March. That pushed the dollar a little higher.
U.S. consumer confidence, however, slightly eased in June, with the index at 100.4 from a downwardly revised 101.3 in May, according to the Conference Board. The June number, however, was marginally higher than the market forecast of 100. The report didn't really hurt the dollar.
"For dollar weakness to happen, we're going to have to see not just some soft data in the U.S., but also need to see the Fed accelerate its rate cuts. We're going to have to see a divergence in data that favors the rest of the world."
Investors are now looking to Friday's release of the U.S. personal consumption expenditures (PCE) price index - the Fed's preferred measure of inflation.
In afternoon trading, the dollar rose 0.1% against the yen to 159.68 yen, clinging to a tight range. Fears of intervention from Japanese officials deterred traders from sharply selling the yen against the dollar and other currencies.
Traders remained wary of testing the 160 level that prompted a 9.79 trillion yen ($61.33 billion) currency intervention from Tokyo in late April and early May.
The latest decline in the yen has come on the back of the Bank of Japan's (BOJ) June policy meeting, where policymakers disappointed investors who were betting on an immediate reduction of the BOJ's massive bond purchases.
The euro slid 0.2% versus the dollar to $1.0714. It has come under pressure amid political turmoil in France in the wake of President Emmanuel Macron's shock snap election call earlier this month.
Against a basket of currencies, the dollar index was up 0.1% at 105.72.
Sterling was slightly higher against the dollar at $1.2693, while the Australian dollar slipped 0.1% to A$0.6649.
China's yuan was little changed against the U.S. currency at 7.2629 per dollar. It fell to 7.2631 per dollar earlier, the lowest since mid-November, and within sight of the lower end of the central bank's daily trading limit of 7.265 on Tuesday.
The yuan has never breached this threshold.
Politics was also at the forefront of investors' minds, with the first U.S. presidential debate between President Joe Biden and his predecessor Donald Trump set for Thursday and French elections due to begin this weekend.
In cryptocurrencies, bitcoin gained ground after its worst day in more than two months at the start of the week, in part due to flows out of bitcoin exchange-traded funds (ETFs), analysts said. Bitcoin was last up 4.6% at $62,182.
EUR/USD:
EUR/USD traded within familiar levels on Wednesday, keeping the Fiber trapped in near-term consolidation just north of 1.0700 as Euro traders hunker down for the wait to meaningful data releases. Momentum is set to remain thin as markets await fresh data to drive market flows beginning on Thursday.
Forex Today: The FX universe remains in waiting mode
Wednesday’s economic calendar is notably thin, though traders will note that the latest German GfK Consumer Confidence Survey for July is expected to improve slightly from the previous print of -20.9 to -18.9. European Central Bank (ECB) Chief Economist Philip Lane is also expected to deliver some talking points during the European market session. Still, the ECB Executive Board member is not expected to rock the boat or otherwise deviate from recent talking points shared by other ECB board members.
The US will also release the latest Bank Stress Test results, but performance is not expected to wildly deviate from previous runs through the Federal Reserve’s stress test of the US banking system. The current “severely adverse” stress test asks banks to examine the soundness of their balance sheets under a hypothetical scenario where the US Unemployment Rate reaches 10% within a two-year period, alongside an increase in market volatility, a 36% decline in housing prices, and a 40% drop in commercial real estate values.
Thursday will kick off the week’s data releases in earnest, with final pan-EU Consumer Confidence figures for June as well as a revision print for Q1’s US Gross Domestic Product (GDP) print which is expected to hold steady at 1.3% QoQ.
Friday will blow the doors off the week’s otherwise sedate economic release schedule with German Retail Sales figures for May and the latest print of US Personal Consumption Expenditure Price Index (PCE) inflation, also for the monthly period of May. One of the Federal Reserve's (Fed) preferred inflation metrics, investors will be closely monitoring a continued decrease in crucial US inflation figures to ensure the Fed stays on track to implement an initial rate cut when the Federal Open Market Committee (FOMC) convenes on September 18.
GBP/USD:
GBP/USD treaded water on Tuesday as investors mostly stood pat with a lack of meaningful data to drive market bets in either direction. The pair drifted in a slow circle near the 1.2700 handle, with a data-light Wednesday on the offer for the mid-week market session.
Data was notably thin on the Tuesday market session with the UK absent from the data docket and US data strictly mid-tier. The Richmond Fed’s Manufacturing Index declined sharply to -10 in June, down sharply from the previous print of 0 and entirely missing the forecast increase to 2. The CB Consumer Confidence survey index also eased back, but not as much as expected as the sentiment indicator ticked down to 100.4 from the previous 102.0 but stopping just short of the forecast 100.0.
The week’s noteworthy data releases will kick off on Thursday with the Bank of England’s )BoE) latest Financial Stability Report, followed by US Durable Goods Orders and US Gross Domestic Product (GDP) revisions for the first quarter.
Friday will round out an otherwise low-impact trading week with the UK’s own GDP quarterly revisions, followed by the latest print of the US’ Personal Consumption Expenditure Price Index (PCE) inflation. As one of the Federal Reserve’s (Fed) favored inflation metrics, investors will be looking for a continued cooling in critical US inflation figures to keep the Fed on pace to deliver a first rate cut when the Federal Open Market Committee (FOMC) meets on September 18.
Gold
Gold price (XAU/USD) remains under some selling pressure for the second successive day and drops to over a one-week low during the Asian session on Wednesday. Comments from Federal Reserve (Fed) Governors Michelle Bowman and Lisa Cook on Tuesday suggested that the central bank is unlikely to kickstart its rate-cutting cycle anytime soon amid a resilient US economy. The hawkish outlook triggers a modest uptick in the US Treasury bond yields, which acts as a tailwind for the US Dollar (USD) and undermines the non-yielding yellow metal.
Investors, meanwhile, are still pricing in a greater chance of a September Fed rate cut move in the wake of weaker inflation data for May. This, along with the risk of a further escalation of geopolitical tensions in the Middle East and the protracted Russia-Ukraine war, lends some support to the safe-haven Gold price. Traders might also prefer to wait for Thursday's release of the final US Q1 GDP print and the Personal Consumption Expenditures (PCE) Price Index on Friday before positioning for the next leg of a directional move for the XAU/USD.
1.
USD/INR as on 25th June, 2024
Currency
OPEN
HIGH
LOW
CLOSE
USD/INR
83.4850
83.4075
83.4325
Forward premium (%) as on 24th June, 2024
Periods
1 Month
3 Month
6 Month
12 Month
Premium
1.02/1.17
1.09/1.14
1.27/1.30
1.63/1.64
USD/INR Cash/Tom/Spot Levels: (in Paisa)
(Updated as on 25th June 2024, @ 09.00am)
Cash/Tom: 0.10/0.80 Cash/Spot:0.20/1.60
Tom/Spot: 0.10/0.80 Spot/Next: 0.30/2.00
Cash Date: 26.06.2024
Tom Date: 27.06.2024
Spot Date: 28.06.2024
Outlook for the day 26th June, 2024
Rupee expected to trade in range of 83.45-83.65
MAJOR WORLD CURRENCIES: as on (24th June, 2024)
CURRENCY
GBP
1.2680
1.2702
1.2667
1.2683
EUR
1.0733
1.0743
1.0689
1.0713
AUD
0.6654
0.6672
0.6633
0.6645
JPY
159.57
159.78
159.18
159.69
CHF
0.8929
0.8952
0.8911
0.8946
XAU
2332.88
2337.07
2315.40
2319.0095
Foreign Currencies
Updated: 17:30 hrs. (12:00 GMT) on 25th June, 2024
USD/INR: 83.4375 [FXIR]
Against
USD
INR
1 EUR =
1.0710
89.3616
1 GBP =
105.8238
100 JPY =
159.47
52.3218
1 AUD =
0.6649
55.4776
1 CHF =
0.8936
93.3723
Precious Metals
Updated: 17:30 hrs. (12:00 GMT) as on 21th June, 2024
Gold ($/oz)
2332.40
Silver ($/oz)
29.56
Stock Indices
Index Close
24th june, 2024
25th june, 2024
BSE Sensex
77341.08
78053.52
NSE Nifty
23537.85
23721.30
Dow Jones
39411.21
39112.16
NASDAQ
17496.82
17717.65
Major Economic Data Releases for the Day
Date
Region
Time (IST)
Description
26.06.2024
7.00AM
CPI y/y
y/y
7.30PM
New Home Sales
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