Rupee Opens Higher, Tracking Buoyant Yuan

Rupee Opens Higher, Tracking Buoyant Yuan

18 Apr 2019 09:12 AM

USD/INR – The Indian rupee opened higher against the dollar after robust economic data boosted the Chinese yuan to near nine-month highs. The rupee, resuming trade after yesterday’s market holiday, opened at 69.46 versus its previous close of 69.60. Foreign investors have pumped in more than $6 billion into Indian equities in March and April, lifting the Sensex by almost 10% in that period to lifetime highs. Voting in the second phase of India elections will take place today. Meanwhile, the yuan on Thursday maintained its advance to near nine-month highs of 6.6890 to the dollar. The Chinese currency yesterday climbed 0.4% yesterday after the country’s first-quarter economic growth beat forecasts and March industrial output rose by the most in four years.

EUR/USD – The euro was buoyant on Thursday after more evidence of strength in China improved the outlook for the global economy, with the market looking next to European indicators to provide the currency with a further boost. The euro was a shade higher at $1.1298, having eked out a gain of 0.1% the previous day. The single currency has steadily recovered from a recent low of $1.1183 plumbed at the start of April. The euro was lifted after data on Wednesday showed China's economy grew at a steady 6.4% pace in the first quarter, defying expectations for a further slowdown, as industrial production surged and consumer demand showed signs of improvement. 

GBP/USD – The GBP/USD pair reached a fresh weekly low of 1.3028, holding nearby at the end of the American session, as the dollar surged with uneven strength during the American session as sentiment turned dismal, while UK inflation missed the market's expectations. According to the UK's Office for National Statistics, inflation rose by 0.2% MoM and by 1.9% YoY in March, both missing the market's forecasts, while core inflation remained unchanged from the previous month, steady at 1.8% YoY. Brexit has been put on pause amid the Easter recess, but despite the absence of fresh headlines, the uncertainty keeps weighing on Sterling. The UK will release March Retail Sales this Thursday, seen down by 0.3% MoM and up by 4.6% when compared to a year earlier. GBP/USD was last trading at 1.3040.

 USD/JPY – The U.S. currency was lower at 111.90 yen after briefly touching a four-month peak of 112.17 on Wednesday amid a bounce in U.S. Treasury yields to a one-month high. Japanese Finance Minister Taro Aso will travel to the United States on April 25 to meet Treasury Secretary Steven Mnuchin on the sidelines of a summit between Japanese Prime Minister Shinzo Abe and U.S. President Donald Trump, a source said on Thursday. Aso and Mnuchin may discuss provisions against currency manipulation that the United States hopes to include in a trade agreement with Japan, said the source. Currencies are a sensitive subject for Japan because it has been criticised for keeping the yen weak with monetary easing.

 Currency Range for today

Currency Pair Lower Upper
USD/INR 69.25 69.75
EUR/INR 78.05 78.85
GBP/INR 90.20 91.00
JPY/INR 0.6180 0.6240

Important data releases today

Time Ccy Event Forecast Previous
1:00 PM EUR German Manufacturing PMI (Apr) 45.0 44.1
2:00 PM GBP Retail Sales (MoM) (Mar) -0.3% 0.4%
6:00 PM USD Core Retail Sales (MoM) (Mar) 0.7% -0.4%
6:00 PM USD Philadelphia Fed Manufacturing Index (Apr) 10.4 13.7
6:00 PM USD Retail Sales (MoM) (Mar) 0.9% -0.2%