INR forecast: Opens 70.95 as against yesterday close of 79.74. Range for the day is 70.55 to 71.10 and a beak consistent trade 71 would bring 71.40.
For last few days, exported are shying away and importers are showing signs of panic. If INR continues to trade above, this trend would gather steam. Making it even more difficult for policy makers to change it. We hope that today at 71 there is good intervention or policy statement during the day.
We need to remember history- INR generally is weakest in Aug and Sept sees reversal. No guarantee of history repeating!
Globally, EMs are weak as trade war resurfaces. GBP looks strong and charts shows very healthy upmove. Equities look very vulnerable.
Today China has again fixed CNY weaker and it would play on INR movement.
For the day suggest small export hedging for short term around 71-71.10 and at 71.40 (if that comes) and near term import around 70.50 and then at 70.20.