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HSL PCG CURRENCY DAILY

15 December, 2016

PRIVATE CLIENT GROUP [PCG]


MAJOR CURRENCY VIEW POINT
Prev.
Close Chg. % Chg. Rupee Depreciation on Card on Feds Rate Hike
Close
USDINR 67.445 67.540 -0.095 -0.14% The Indian rupee closed stronger against the US dollar on cool down
DXY INDX 102.220 100.94 1.280 1.27% in inflation. The rupee closed at 67.45 per US dollar--up 0.14% from
EURUSD 1.052 1.065 -0.013 -1.21% its previous close of 67.54. The home currency opened at 67.55
GBPUSD 1.255 1.265 -0.010 -0.76% against the US dollar. So far this year, it has fallen 1.9%.
USDJPY 117.240 114.92 2.320 2.02% The benchmark 10-year government bond yield closed at 6.406%,
DG USDINR 67.760 67.536 0.224 0.33% compared to Tuesdays close of 6.419%.
Wholesale inflation eased for the third straight month as it fell to
3.15% in November after subdued demand due to demonetisation
GLOBAL INDICES
led to softening of prices of vegetables and other kitchen staples.
The one month forward USDINR NDF quoted at 68.00 from
Prev. yesterdays 67.66 5pm(IST) indicating strong opening at domestic
Close Chg. % Chg.
Close bourses. The USDINR will move higher on stronger overseas dollar.
SGX NIFTY 8116.5 8184.5 -68 -0.83% Technically, the Spot USDINR is having support around 67.30 marks
NIFTY 8182.5 8221.8 -39 -0.48% while continue to resist at 67.75 and 68.21
SENSEX 26602.8 26697.8 -95 -0.36%
Dollar Rises To 14 Year High After Feds Hawkish Stance
HANG-SENG 22102.0 22456.6 -355 -1.58%
After a years long time, the fed has raised interest rates by 25bps.
NIKKEI 19225.2 19253.6 -28 -0.15% This was 100% discounted. The FOMC raised rate range by 25 bps
SHANGHAI 3132.1 3140.5 -8 -0.27% to 0.50 to 0.75%. Additionally, the appropriated fed funds rate for
S&P INDEX 2253.3 2271.7 -18 -0.81% the end 2017 has shifted upwards to imply 3 rate increases rather
DOW JONES 19792.5 19911.2 -119 -0.60% than expectation of two on view of rise in growth. Verbally, Yellen
NASDAQ 5436.7 5463.8 -27 -0.50% emphasised the change in forecasts as only a modest adjustment
and continued the stance that the evolution of economy warranted
FTSE 6949.2 6968.6 -19 -0.28%
only gradual increases.
CAC 4769.2 4803.9 -35 -0.72% The dollar spiked higher on the announcement. A stronger dollar is
DAX 11244.8 11284.7 -40 -0.35% todays theme with crowded trade which will be a favourable trades
of the day as the demand for the dollar likely to rise.
INSTITUTIONAL ACTIVITY (Provisional Rs. In Cr) The dollar hovered near a 14-year peak against a basket of major
currencies today, receiving a major boost after the Federal Reserve
Segment 14-Dec-16 13-Dec-16 increased the number of projected interest rate hikes for 2017. The
dollar index stood at 102.22 after rising to 102.350 overnight, its
Equity -731.86 334.03 highest since January 2003.
Debt -411.44 -245.64 Market is re-pricing additional Fed hikes in 2017 though financial
markets are not under stress and fiscal policy is set to turn
expansionary. The bias for the buck remains bullish with higher side
109.24 and support at 99.43.

PRIVATE CLIENT GROUP [PCG]


TECHNICAL OUTLOOK
SPOT USDINR DAILY CHART

Technical Observations

USDINR drifted lower after day before yesterdays gain. The pair closed at 67.45 with loss of 0.14%.
The pair has the support around 67.11, the 200 Days simple moving average.
Momentum oscillators entered in oversold territory indicating short covering.
In near term, the pair likely to move higher on positive breakout in dollar index. The USDINR could move towards 68.21 with
support of 67.30.

PRIVATE CLIENT GROUP [PCG]


TECHNICAL LEVELS

Near Month Fut. Last Pivot S3 S2 S1 R1 R2 R3 View For The Day

USDINR 67.51 67.54 67.27 67.37 67.44 67.61 67.71 67.78 Short Covering
EURINR 71.91 71.95 71.41 71.61 71.76 72.10 72.30 72.45 Bearish
GBPINR 85.44 85.50 84.93 85.14 85.29 85.65 85.86 86.01 Bearish
JPYINR 58.84 58.81 58.43 58.54 58.69 58.96 59.07 59.22 Bearish

Wkly Wkly 1-Mth. 1-Mth. 52 Wk 52 Wk


Spot 5 DMA 20 DMA 50 DMA 100 DMA 200 DMA
High Low High Low High Low
USDINR 68.27 67.33 68.86 66.34 68.86 66.07 67.48 68.10 67.30 67.11 67.12
EURINR 73.35 71.42 75.64 71.42 77.49 71.42 72.01 72.56 73.22 74.00 74.64
GBPINR 86.88 84.83 86.88 82.20 100.77 80.89 85.29 85.41 83.61 85.62 90.05
JPYINR 60.14 58.78 66.11 58.08 68.11 53.86 58.73 60.25 62.45 64.09 63.07

CURRENCY MOVEMENT
Open Chg. In
Currency Open High Low Close Chg. Chg. in OI Volume
Interest Volume
SPOT USDINR 67.55 67.59 67.43 67.45 -0.10 -- -- -- --
USDINR DEC. FUT. 67.57 67.64 67.47 67.51 -0.08 1716971 128575 1081737 -447511
SPOT EURINR 71.83 72.02 71.65 71.76 0.10 -- -- -- --
EURINR DEC. FUT. 71.92 72.15 71.80 71.91 0.10 34153 -2347 37863 7458
SPOT GBPINR 85.48 85.62 85.23 85.32 -0.43 -- -- -- --
GBPINR DEC. FUT. 85.67 85.72 85.36 85.44 -0.39 27953 4068 35334 -6343
SPOT JPYINR 58.61 58.78 58.53 58.69 0.15 -- -- -- --
JPYINR DEC. FUT. 58.66 58.92 58.66 58.84 0.21 38178 41 19876 -2188

PRIVATE CLIENT GROUP [PCG]


ECONOMIC EVENTS RELEASED
Date Time Country Event Period Survey Actual Prior
12/14/2016 10:00 JN Industrial Production YoY Oct F -- -1.40% -1.30%
12/14/2016 12:00 IN Wholesale Prices YoY Nov 3.10% 3.15% 3.39%
12/14/2016 15:30 EC Industrial Production WDA YoY Oct 0.90% 0.60% 1.20%
12/14/2016 17:30 US MBA Mortgage Applications 9-Dec -- -4.00% -0.70%
12/14/2016 19:00 US PPI Final Demand YoY Nov 0.90% 1.30% 0.80%
12/14/2016 19:45 US Industrial Production MoM Nov -0.20% -0.40% 0.00%
12/14/2016 19:45 US Manufacturing (SIC) Production Nov -0.40% -0.10% 0.20%
12/15/2016 00:30 US FOMC Rate Decision (Upper Bound) 14-Dec 0.50%-0.75% 0.50%-0.75% 0.25%-0.50%

ECONOMIC EVENTS RELEASED


Date Time Country Event Period Survey Prior
12/15/2016 14:30 EC Markit Eurozone Manufacturing PMI Dec P 53.7 53.7
12/15/2016 14:30 EC Markit Eurozone Services PMI Dec P 53.7 53.8
12/15/2016 17:30 UK Bank of England Bank Rate 15-Dec 0.25% 0.25%
12/15/2016 17:30 UK BOE Asset Purchase Target Dec 435b 435b
12/15/2016 17:30 UK BOE Corporate Bond Target Dec 10b 10b
12/15/2016 19:00 US Current Account Balance 3Q -$111.0b -$119.9b
12/15/2016 19:00 US Empire Manufacturing Dec 2.6 1.5
12/15/2016 19:00 US CPI YoY Nov 1.70% 1.60%
12/15/2016 19:00 US Initial Jobless Claims 10-Dec -- 258k
12/15/2016 19:00 US Continuing Claims 3-Dec -- 2005k
12/15/2016 20:15 US Markit US Manufacturing PMI Dec P -- 54.1

PRIVATE CLIENT GROUP [PCG]


Technical Analyst: Vinay Rajani (vinay.rajani@hdfcsec.com)
Currency Analyst: Dilip Parmar(dilip.parmar@hdfcsec.com)

HDFC securities Limited, I Think Techno Campus, Building - B, "Alpha", Office Floor 8, Near Kanjurmarg Station, Opp. Crompton Greaves, Kanjurmarg (East), Mumbai 400 042
HDFC securities Limited, 4th Floor, Astral Tower, Above HDFC Bank Ltd, Nr.Mithakhali Six Roads, Navrangpura, Ahmedabad 380009.
Phone: (079)66070168, Website: www.hdfcsec.com Email: pcg.advisory@hdfcsec.com

Disclosure:

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PRIVATE CLIENT GROUP [PCG]