INR opens near flat at 71.78 as against Fri close of 71.74 and May trade in the range of 71.66 to 71.90. The GDP numbers came in as per the expectations and hence we don’t expect the market to react. Market may rather look ahead at possible recovery in office with the GST numbers coming in excess of one lakh crores. India 10 year G Sec yield continues to be below 6.5%
This week we have RBI meeting on December 5 and we expect further interest rate cut of 0.25%. Overall we think economic recovery is getting legs and should pick up in the months to come.This morning most Asian equities are trading with mild gains and nifty should also remain near flat or trade with some gains.
As a suggestion export hedging to restart at levels near 72 and import to continue using plain call options around 71.50