New Delhi, Aug 15 (IANS) Healthy foreign fund inflows along with expectations of a domestic stimulus are expected to strengthen the Indian rupee in the short term.
“Markets are awaiting further US and domestic stimulus as well. Till now, sentiment has remained positive even on back of record number of new Covid-19 cases in India on a daily basis,” said Sajal Gupta, Head, Forex and Rates, Edelweiss Securities.
“The expected range for rupee may be 74.50 to 75.20.”
Last Friday, the rupee slightly weakened to 74.90 against a greenback.
“The important event for all asset classes are the US-China trade talks scheduled for tonight. Trump has been bashing China for the outbreak of coronavirus infection so any negative outcome may lead to an influx of widespread risk aversion, pushing the USD-INR spot higher,” said Rahul Gupta, Head of Research-Currency, Emkay Global Financial Services.
“Technically, only a consistent trading above 75 will open doors for 75.50. Thus, we expect USD-INR spot to continue trading in between the broader range of 74.50-75.50.”
According to Devarsh Vakil, Deputy Head of Research at HDFC Securities, “Recent economic data and weaker dollar index has helped in recent appreciation of the rupee in the short run. However, with short positioning reaching extreme levels, recent shorts may face the risk of a corrective move higher given that the short US Dollar trade is looking crowded.”
“Alongside this, given the volatility is rising in riskier assets and global risk appetite is waning, the US Dollar may begin to reverse course.”
–IANS
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