This week Indian Rupee traded bearishly, mainly taking cues from the dollar demand from the oil and defense payment. Also there are some corporate dollar buying is going on. Rupee depreciated this week after a strong five week. Rupee has gained more than 7% since the start of this year, driven primarily by foreign fund inflows that have touched nearly $7 billion so far. In January Rupee gained about 7.45% against the dollar and its best monthly gain in more than 17 years supported by the inflows of foreign fund in debt market.
Importers are suggested to buy in futures to hedge their spot positions as rupee is likely to trade weak.
Looking at the current scenario expect rupee to continue its weak trend. 49.80 is the major support for the rupee once breached we could see rupee trading over 50.00 levels. Expect rupee to trade within 49.10-50.10.
The dollar index, which tracks its performance against a basket of major currencies, traded bearishly internationally, mainly against Euro, taking cues from positive news of bailout deal from Greece.
Although Greek political leaders have done a deal at the last minute, the bailout is still pending approval of international lenders, keeping investors guessing and pulling the euro off two-month highs against the dollar and the yen. Many of the economist’s think that the bailout deal will only improve the present economic status of Greece and it is not the surety of avoiding default.
Gold continued to trade bearishly for the third consecutive day as overnight dollar traded strong. U.S. gold extended its fall and weakened more than 1% in the day. Spot gold was also headed for a 0.4-percent weekly fall, its second consecutive week of declines, after following the ups and downs of Greece's struggle to agree to reforms and austerity measures in exchange for an economic rescue package.