Rupee Opens Higher As Vote Counting Begins

Rupee Opens Higher As Vote Counting Begins

23 May 2019 09:12 AM

USD/INR – The Indian rupee opened higher as vote counting for the nation’s federal elections begin. The rupee opened at 69.45 at opening compared with its previous close of 69.66. Very early trends, as reported by television channels, show that the NDA is gaining. Meanwhile, Asian cues were negative on Thursday. Regional currencies and equities were mostly lower amid lingering U.S.-China trade tensions. Late Wednesday, it was reported the U.S. administration was considering Huawei-like sanctions on Chinese video surveillance firm Hikvision over the country's treatment of its Uighur Muslim minority.

EUR/USD – The euro was flat at $1.1150, in close range of a 2-1/2-week low of $1.1142 brushed on Tuesday ahead of the May 23-26 European parliamentary election. The German and euro zone manufacturing purchasing managers' index (PMI) releases due later on Thursday may impact the single currency. EUR/USD has held to tight ranges throughout Q2 so far but daily ranges have become even more constrained as key data and elections approach. Those two risks are likely to determine if EUR/USD extends its long-term bear trend or sees a rebound. Polls look for better growth compared to April's results. Downbeat results would dash any hopes of economic green shoots, sending euro zone rates and the euro lower. EU elections begin Thursday, with results expected Sunday. The voting might not create much immediate impact but downside risks for EUR/USD could increase if anti-EU parties gain parliamentary seats in significant numbers. Investors might avoid the euro on such as result.

GBP/USD – The pound dipped 0.07% to $1.2652 after slipping to $1.2625 overnight, its lowest since Jan. 4. The currency had earlier plumbed four-month lows against the dollar, falling as much as 0.6% at one point as it became clear that May's last-ditch Brexit plan had failed to win over either opposition lawmakers or many in her own party. With the plan appearing dead in the water, some traders said they saw a rising chance of Britain leaving the European Union without a transition deal to smooth economic disruption.

USD/JPY – The yen advanced broadly on Thursday as persistent U.S.-China trade fears and Brexit concerns fanned risk aversion, lifting the safe-haven Japanese currency. The yen was 0.1% firmer at 110.25 to the dollar, having pulled back from a two-week low of 110.675 plumbed on Tuesday. Japanese exports contracted for the fifth month in April due to a slump in shipments of chip-making equipment to China, underlining the growing threat to the world's third-biggest  economy from a bruising Sino-U.S. trade war. Data also showed Japan's trade surplus with the United States rose for a second month as auto exports accelerated, which could draw U.S. President Donald Trump's ire before U.S.-Japan trade negotiations begin this week followed by a leaders' summit a few days later.

Currency Range for today

Currency Pair Lower Upper
USD/INR 69.30 69.80
EUR/INR 77.20 78.00
GBP/INR 87.55 88.35
JPY/INR 0.6270 0.6330

Important data releases today

Time Ccy Event Forecast Previous
11:30 AM EUR German GDP (QoQ) (Q1) 0.4% 0.4%
1:00 PM EUR German Manufacturing PMI (May) 44.8 44.4
1:00 PM EUR German Ifo Business Climate Index 99.2 99.2
2:00 PM GBP Retail Sales (MoM) (Apr) - 1.1%
7:30 PM USD New Home Sales (Apr) 675K 692K


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