Good morning everyone ! This is yet another instance of getting the USDINR move right. In continuation to last week (Wednesday and FOMC Post) expecting rupee to get to 73.80 areas, we have finally reached the zone with pair open at 73.92 today after trading a low of 73.87 overnite.

The move is largely driven by some technical correction post the FOMC as well as inflows related to Paytm’s IPO and yes broadly supportive risk appetite too. Forwards, after the recent spike (though now near term lower from the high’s) can also add to further inflows if risk appetite stays positive. 1 Year premium is at 4.75% and expected volatility on the pair remains fairly muted thereby giving encouraging signal for carry trades.

For a start, pair likely to play out a 73.82.-74 band..Break either side and u get additioanl 10-15 move quickly.. As suggested y’day, I prefer to buy these dips using forwards and keep adding at further dips..Have sold higher at all rallies and now only buying via forwards.

Good day,
Sonali