USDINR: (Short term bias- Upward drift.
Support March futures – 83.20 and 83.10
Resistance- 83.35 and 83.45)

USD/INR appears to have broken free as prices opened above the resistance cluster near 83.20 on the spot. The next resistance is anticipated near the 83.40/45 levels. The surge in the overnight US Dollar Index, alongside the upward movement in USDCNH, has contributed to this momentum. Dovish remarks from the UK central bank and a surprise rate cut from the Swiss National Bank have further fuelled bearish sentiment in European currencies, consequently bolstering the US Dollar against most counterparts, including the Rupee.

In the upcoming week, expect trading to become choppy and volatile as year-end flows intersect with the global trend in the US Dollar. The broader range is expected to fluctuate between 83.10 and 83.45 on the spot, with interim support likely to materialize near 83.20 levels.



GBPINR: (Short term bias – Downward drift.
Support March futures- 105.10 and 104.85
Resistance – 105.35 and 105.55

Two of the Bank of England's most steadfast proponents for interest rate hikes have retracted their support, leading to a unanimous decision to maintain unchanged policy for the fifth consecutive meeting. This marks the first instance since September 2021 that no member of the panel has advocated for a rate increase. Consequently, the British Pound depreciated, and traders escalated their expectations for rate cuts this year, fully pricing in three quarter-point reductions for the first time in a month. Today, attention will be focused on UK retail sales data.

GBP/USD is currently finding support around the 1.2600 level, corresponding to approximately 105.00 on the GBPINR pair. Subsequent support levels for the pair are anticipated near 104.60 and 104.20. Throughout the year, GBPINR has oscillated within a broad range, typically fluctuating between 104.00 and 106.50 levels.



EURINR: (Short term Bias- Downward drift.
Support March futures – 90.00 and 89.70,
Resistance – 90.55 and 90.75)

The robust US macroeconomic data, coupled with a mixed bag of Eurozone PMIs, propelled the US Dollar higher while exerting downward pressure on the Euro. Declining US unemployment claims, along with a stronger-than-anticipated regional manufacturing index from the Philly Fed and manufacturing PMI, outweighed disappointment from the services PMI. Additionally, existing home sales data exhibited strength. Conversely, Eurozone manufacturing PMI weakened, slipping into contraction territory, despite an improvement in services PMI.

Looking ahead, the Euro could continue its descent against the US Dollar, potentially descending towards the 1.07/1.0730 levels. This downward trend suggests EUR/INR may experience further downside as well. Support levels for EUR/INR are expected around 90.00 and 89.70.



JPYINR: (Short term bias- Near major support.
Support March futures- 54.90 and 54.70,
Resistance- 55.25 and 55.50)

USD/JPY is currently hovering just below the crucial resistance level near 152.00. Consumer price inflation surged to 2.8% year-on-year in February, compared to 2.2% in January and surpassing the market consensus of 2.9%. This increase is largely attributed to a low base last year, linked to government energy subsidy programs. Despite the decline in US bond yields, the Japanese Yen is weakening due to relatively attractive carry trade returns and the strength of the US Dollar Index.

Given the resistance encountered by USD/JPY at the 152.00 levels and the upward movement of USD/INR, we do not recommend shorting JPY/INR at current levels. Traders considering long positions in JPY/INR are advised to maintain a strict stop-loss below 54.75 levels.