The firm week for Indian equity was combined with good economic data. Indirect tax collections – comprising revenue from customs, excise and service tax – rose by 43% to Rs569.3bn in the first quarter of the current fiscal year, up from Rs396.94bn in the year-ago period. Agricultural minister Sharad Pawar said this is the right time to decontrol sugar prices on the back of strong sugar production expectations.
INR closed flat Monday, in a range bound trading session on account of low volumes seen in overseas market.
The overall impetus in the major traded currencies seems to be for a slight strengthening of the U.S. dollar against the euro, yen, and pound.
RUPEE
The rupee is currently trading at 46.15 levels. We had expected the test of 47.20 again which had reached some days back. Break of 45.50 has entered rupee in a bearish phase. Near term Exportersmaintain some covers above 47.00 plus to be safe.
Currency market volatility may lighten this week after several weeks of heightened activity. The euro continued its strong declines early last week, but by the middle of the week had recovered as investor sentiment improved over euro zone sovereign debt problems.
India’s foreign exchange reserves fell for the second consecutive week, to $271.093 billion, on account of a decline in the foreign currency assets
Rupee to show upward trends vs dollar
London-based CD Capital Founder Carmel Daniele has seen these sorts of market jitters before, and insists there is little to worry about in this exclusive interview with The Gold Report. “Most people sell in May and go away. It happens every year,” she says. The self-assured Daniele launched the CD Private Equity Natural Resources Fund in 2006 to tap into what she calls a commodity super-cycle. She says that despite a recent dip in the copper price, the super-cycle is in good form, and she envisages gold nearing $2,000 within 12 months. She also recommends you take advantage with some promising junior gold plays in Colombia.
Core Durable Goods Orders m/m data will be released tonight which measures Change in the total value of new purchase orders placed with manufacturers for durable goods, excluding transportation items. It will have a minor impact on US dollar which will affect base metal and bullion prices.
According to Jeffrey Nichols, Senior Economic Advisor to Rosland Capital and Managing Director of American Precious Metals Advisors
ALERT: NICKEL & LEAD DOWN NEAR 5% AS INVESTORS SOLD ASSETS IN THE FACE OF WORRIES ABOUT DEBT PROBLEM IN THE EURO ZONE & IN THE FACE OF A STRONGER DOLLER. www.shahpurafinance.com
China is unlikely to allow the yuan to appreciate against the dollar this year because Europe’s debt crisis has pushed the euro lower, according to Marc Faber, says a report from China Post.
By Jim Sinclair
Tomorrow is the first day Greece receives a tranche of emergency funding which of course caused some euro short covering from below 1.2236 to the present 1.2394. Recall I gave you the 121 1/2 to 122 1/2 as support under the break of 126.
Global currency markets are expected to remain volatile this week. European governments have not been able to persuade investors that sovereign debt problems have been adequately addressed.
DOLLAR :
Higher levels were not sustained in USDINR and the pair dwindled sharply thereby touching intraday low of 45.07.
REVIEW : Friday was yet another day for rupee to lose against the dollar on account of choppy equity markets and initial strengthening of dollar index. However, it recoiled from the six-week low on account of anticipated central bank intervention, to prevent higher currency fluctuations.
By Dan Norcini
There was continued pressure on equities overnight and into today’s session as fears spread that the situation in Greece is going to spread further into the Euro Zone. Portugal, Spain, and Italy are now the prime candidates. Some are going as far as saying that the Euro zone is going to break up. Such thinking will bring safe haven buying into gold especially in Europe which is exactly what we saw. Gold in euro terms remains very strong coming in at the PM fix above the 906 level.
By Adrian Ash
Gold held near a 4-month high vs. the Dollar early in London on Wednesday, trading above $1162 an ounce as the US currency hit a 12-month hit against the Euro on fresh political wrangling over the Greek government bail-out.
Euro to show upward trends against dollar
By Chuck Butler
Good day, and welcome to Tuesday. The Cardinals brought home a winner for the huge crowds down at Busch Stadium yesterday. As I mentioned, opening day is holiday around St. Louis, and Albert Pujols and his teammates gave the fans a terrific show. Currency traders seemed to take the day off yesterday along with thousands of Cardinal fans. The dollar drifted through the day, and continued to trade sideways in overnight trading in Asia.
Following is the commodity market update from SMC:
By Adrian Ash
Gold Prices ticked back from a 12-week high for Dollar investors early Thursday, recording the best London Gold Fix since Jan.12th as the US currency rose against the Euro and global stock markets fell.
By Adrian Ash
Gold priced in Dollars held just shy of last night’s 4-week high in London on Wednesday, trading above $1135 an ounce as strong gains on Asian stock markets failed to carry over into Europe
By Dan Norcini
Gold is performing admirably given the extreme volatility in the currency markets. After yesterday’s drop lower in the Euro coming on the heels of Trichet’s comments about IMF involvement with Greece, gold held very steady as more and more it seems as if it has taken on a solid role as an alternative currency in the minds of Europeans. That cannot but help to steady it and provide a solid base of support beneath the market. As the Euro staged a sharp rally this morning, gold then shot higher recapturing the $1,100 level as startled bears ran for cover.
The dollar index has been the talk of the market—it has snapped back over the last couple of sessions to close to 82. Investment Guru Jim Rogers, though has been long on the currency from last fall, is bearish on it from a long-term perspective.
INR opened lower in yesterday’s session as it tracked dollar’s strength against other major currencies in the overseas market. But it appreciated during the day and closed higher as compared to its previous close on the back of strong foreign inflows into the country.
By Adrian Ash
Gold Prices slipped back from an overnight rally Tuesday morning in London, edging again below $1100 an ounce for US investors as world stock markets ticked higher along with government bonds.
The Indian rupee dropped to a one-week low late on Monday as share losses and the dollar’s gains versus major currencies offset the positive sentiment post the Reserve Bank of India’s surprise rate hike late on Friday.
Gold declined further in early trading on Monday as investors sold into a stronger US dollar on financial uncertainties over debt-laden Greece. The Indian rupee fell on Monday after the the Reserve Bank of India, in a surprise move, hiked key policy rates by 25 basis points on Friday.
The Indian rupee is forecast to strengthen this week, possibly moving toward 221 cents per 100 rupee. A wave of profit-taking and technically based selling by shorter term investors could drag the rupee slightly lower, but overall the trend is expected to be upward.
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