Currencies Daily Report

Wednesday| January 16, 2013

Content
Overview US Dollar Euro GBP JPY Economic Indicators
Overview:

Research Team
Fundamental Team Nalini Rao - Sr. Research Analyst nalini.rao@angelbroking.com (022) 2921 2000 Extn. 6135 Anish Vyas - Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn. 6104

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Currencies Daily Report

Wednesday| January 16, 2013

Highlights
US Core Retail Sales rose to 0.3 percent in the month of December. UKs CPI remained steady at -27.5 percent in December. US Empire State Manufacturing Index fell to -7.8 levels UKs PPI remained declined to 0.2 percent in December. UKs Retail Price (RPI) rose to 3.1 percent in last month.

Market Highlights (% change)

Last NIFTY SENSEX DJIA S&P FTSE KOSPI BOVESPA NIKKEI Nymex Crude (Jan13) - $/bbl Comex Gold (Jan13) - $/oz Comex Silver(Jan13) $/oz LME Copper (3 month) -$/tonne CRB Index (Industrial) G-Sec -10 yr @7.8% Yield
102.07 -0.2 6056.6 19986.8 13534.89

as on January 15, 2013 Prev. day

0.5 0.4 0.2

WoW
0.9 1.2 1.5

MoM
5.7 6.1 2.8

YoY
24.5 23.7 9.0

Asian markets are trading on a weak note taking cues from the bearish market sentiments as World Bank forecasts lower growth in the developed economies. Japanese shares are also trading on a weak note due to rise in the Yen and thereby expectation of lower export earnings. World bank has cuts its growth forecast for the developed nations. It projects that the world economy might grow at 2.4 percent down from the June 2012 forecast of 3 percent. US Core Retail Sales rose to 0.3 percent in the month of December as compared to a decline of -0.1 percent in November. US Producer Price Index (PPI) declined to -0.2 percent in the month of December as against a decline of -0.8 percent in November. US Retail Sales rose to 0.5 percent in the month of December as compared to 0.45 percent in November. US Empire State Manufacturing Index fell to -7.8 levels as against -8.1 levels in November.

1472.34
17467.5 1983.7

0.11
6.9 -1.2

1.04
3.0 -0.7

4.16
10.1 -1.0

14.22
16.4 5.8

61727.6 10879.1 85.93 1683.40 3149.80 7989.00

9.7 #N/A 0.8 0.9 1.3 -1.2

1.0 -0.1 -5.6 1.3 3.6 -1.1

4.1 11.7 2.4 -0.7 -2.4 -0.7

4.4 28.0 -10.9 3.3 6.8 4.8

US Dollar Index
US Dollar Index (DX) gained 0.3 percent due to rise in risk aversion in the global markets owing to renewed worries over the US debt ceiling which if not resolved might deteriorate the growth of the economy. This led to increase in the demand for the low yielding currency that is US Dollar Index (DX). However, some of the gains in the index were erased after favorable data from the US economy. US equities traded in the positive terrain taking cues from favorable retail sales data from the nation. The stock had remained lower in early part of trade due to worries over the US debt ceiling which reemerged raising worries that if the debt ceiling is not raised it might restrict growth of the nation. The index touched a high of 79.71 and closed at 79.79 on Tuesday.

0.5

2.1

-1.8

Source: Reuters

US Dollar (% change)
Last Dollar Index US $ / INR (Spot) US $ / INR Jan13 Futures (NSE) US $ / INR Jan13 Futures (MCX-SX)
79.79 54.59

as on January 15, 2013 Prev. day

0.3 -0.1

WoW
-0.8 0.7

MoM
-0.2 -0.2

YoY
-2.5 -5.8

54.7 54.6975

0.17 0.17

-0.96 -0.96

0.16 0.16

5.76 5.76

Source: Reuters

Dollar/INR
The Indian Rupee depreciated 0.1 percent taking cues from rise in the risk aversion in the global markets coupled with strength in the DX. The currency depreciated due to dollar demand from the oil companies and firms. However, sharp depreciation in the currency was capped due to continued foreign institutional inflows. There are also expectations of rate cuts by the Reserve Bank of India in its policy meeting to be held in the later part of the month. For the current month 2013 FII inflows totaled at Rs 10,601.90 crores th till 15 January 2013. While year to date basis, net capital inflows for the year 2013 stood at Rs. 10,601.90 crores. Outlook From the intra-day perspective, we expect Indian Rupee to depreciate due to weak global market sentiments along with strength in the DX. Dollar demand from the oil firm and companies is also expected to depreciate the currency.

Technical Chart USD/INR

Source: Telequote

Technical Outlook
Trend US Dollar/INR Jan13 (NSE/MCX-SX) Sideways

valid for January 16, 2013 Support 54.50/54.30 Resistance 54.85/55.0

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Currencies Daily Report

Wednesday| January 16, 2013

Euro/INR
Euro declined 0.6 percent lower due to depressing comment by the Euro-area finance ministers leader, Jean-Claude Juncker that the currency was dangerously high. This has created bearish market sentiments towards the end of the session. German economy contracted in the final quarter of 2012. This also exerted downside pressure on the currency. Strength in the DX also added to the losses in currency. The currency touched an intra-day low of 1.3266 and closed at 1.3303 on Tuesday. Outlook

Euro (% change)
Last Euro /$ (Spot) Euro / INR (Spot) Euro / INR Jan 13 Futures (NSE) Euro / INR Jan13 Futures (MCX-SX)
1.3303 72.79

as on January 15, 2013 Prev. day

-0.6 0.1

WoW
1.7 -1.2

MoM
1.7 -2.4

YoY
4.9 #N/A

72.9725 72.975

0.04 0.06

0.78 0.78

2.11 2.11

10.28 10.29

Source: Reuters

Technical Chart Euro In todays session we expect Euro to depreciate as the Euro area Finance Ministers leader said that the currency is at higher levels and World Bank has forecasted second year contraction of the euro region. Strength the DX is also expected to exert downside pressure on the currency. However favorable data from the region is expected to cushion sharp fall in the currency. Technical Outlook
Trend Euro/INR Jan13 (NSE/MCX-SX) Sideways 72.65/72.60 73.15/73.30
Source: Telequote

valid for January 16, 2013 Support Resistance

GBP (% change)

as on January 15, 2013

GBP/INR
Last Prev. day
-0.1

WoW
0.1

MoM
-0.3

YoY
4.9

The Pound declined 0.1 percent in yesterdays session due to bearish global market sentiments along with strength in the DX. Unfavorable data from the nation also exerted downside pressure on the currency. The currency touched an intra-day low of 1.603 and closed at 1.6064 on Tuesday. Outlook In todays session, we expect Pound to trade with negative bias on the back of bearish global market sentiments along with strength in the DX. Technical Outlook
Trend GBP/INR Jan 13 (NSE/MCX-SX) Sideways valid for January 16, 2013 Support 87.55/87.35 Resistance 88.0/88.25

$ / GBP (Spot) GBP / INR (Spot) GBP / INR Jan13 Futures (NSE) GBP / INR Jan 13 Futures (MCX-SX)

1.6064

87.688 87.795

0.08 -0.11

-0.60 -1.10

-0.31 -0.24

11.26 10.64

87.795

-0.11

-1.10

-0.24

10.64

Source: Reuters

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Currencies Daily Report

Wednesday| January 16, 2013

JPY/INR
JPY (% change) The Japanese Yen appreciated 0.8 percent as the Japanese Economics Minister Akira Amari said that weakness in the yen might negatively impact the growth of the nation. Rise in the risk aversion in the global markets in yesterdays session also kept the currency appreciated as the demand for the low yielding currency witnessed a rise. The currency closed at 88.78 after touching an intra-day high of 88.27 on Tuesday. Japanese Core Machinery Orders increased to 3.9 percent in the month of November as against a rise of 2.6 percent in October. Outlook For the intra-day, we expect to yen to appreciate due to rise in the risk aversion in the global markets which is likely to increase the demand for the low yielding currency. Additionally, favorable data from the nation is also expected to support appreciation in the currency.
Last JPY / $ (Spot) JPY / INR (Spot) JPY 100 / INR Jan13 Futures (NSE) JPY 100 / INR Jan13 Futures (MCX-SX)
88.78

as on January 15, 2013 Prev day

-0.8

WoW
2.0

MoM
6.2

YoY
15.4

0.6152 61.678 61.683

0.94 0.79 0.80

-2.46 -2.37 -2.37

-5.63 -5.38 -5.39

-7.97 -8.52 -8.49

Source: Reuters

Technical Chart JPY

Technical Outlook
Trend JPY/INR Jan 13 (NSE/MCX-SX) Sideways

valid for January 16, 2013 Support 61.30/60.90 Resistance 61.90/62.20

Source: Telequote

Economic Indicators to be released on January 16, 2013

Indicator Core Machinery Orders m/m CPI y/y Core CPI y/y German 10-y Bond Auction Core CPI m/m CPI m/m TIC Long-Term Purchases Capacity Utilization Rate Industrial Production m/m Crude Oil Inventories Country JPY EU EU EU US US US US US US Time (IST) 5:20 am 3:30 pm 3:30 pm Tentative 7:00 pm 7:00 pm 7:30 pm 7:45pm 7:45pm 9:00pm Actual 3.9 % Forecast 0.4 % 2.2% 1.5% 0.2% 0.0% 19.8B 78.6 % 0.2% 2.0 M Previous 2.6 % 2.2% 1.4% 1.40|1.5 0.1% -0.3% 1.3B 78.4 % 1.1% 1.3 M Impact Medium Medium Medium Medium High Medium Medium Medium Medium Medium

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