INR opens at 70.96 as against yest close of 70.81 and today may trade in range of 70.80 to 71.20. The CNY devaluation is till playing out as it continues to weaken ( now 7.046). The collateral damage is on crude which is falling and is expected to fall even further ( Brent break of 57-58). There are some reports citing huge build of Iran crude in “bonded storage” tanks in China waters and China could start using that. This, it true, could lead to sharp fall in crude. One such report is below. We think that report gives a very extreme view.
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In normal situation, fall in crude ( if it happens) should aid INR. But is current situation, it may not. INR would be guided by movement in CNY.
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We have been saying for many weeks now that Gold looks strong and we continue to support it even at current levels ( 1485 USD per ounce). Today most Asian equities are coming off from higher opening. US ten year yield fell to 1.68 and Indian yield to 6.34. Clear sign of huge risk aversion.
We have been saying for many weeks now that Gold looks strong and we continue to support it even at current levels ( 1485 USD per ounce). Today most Asian equities are coming off from higher opening. US ten year yield fell to 1.68 and Indian yield to 6.34. Clear sign of huge risk aversion.
Overall suggest to hedge imports via options and start picking long term export hedges around 71.40 ( may be seen in coming day)