INR opens flat at 71.08 as against yesterday close of 71.04 and may trade in range of 70.80 to 71.14. For INR, the main theme for next few days could be fiscal deficit number that govt may announced on Feb 1st budget. Any major fiscal slippages would not be liked by bond investors and as a consequence impact bond inflows. Yesterday, trade deficit for Dec came in at USD 13 bn from highs of USD 18 bn (was expected).
Globally, BREXIT vote failed in UK Parliament (with historically highest margin) and now opens many paths. The good part is that global markets did not react much and GBP also bounced back after initial sell off. Now, the following paths are likely:
1. Fresh negotiations with EU (high chances)
2. Extension of Article 50 and hence get more time to exit EU
3. Second referendum in UK
4. No deal BREXIT
5. May loose vote of confidence and fresh elections etc (We assign very low chances)
Overnight crude again came above 60; USD was stronger and today Asian equities are mildly weaker