Usd/INR Daily

The range bound movement continued in dollar as the pair which opened at 46.85 closed the day at 46.83 levels. Currency markets continued to be independent of equity markets which rose by 33 points to close the day at 4729 points. Even as USDINR continues to move in a range, other correlations also seem to have gone in disarray for some time now. Dollar index which was considered to be a prime driver of asset classes across the globe seems to have reversed its trend without any major effect on equity markets. Dollar index continued it rise and traded at 78.23 levels even as Dow Jones closed up by 50 points at 10464 levels. Another key economic data which was released yesterday was GDP figures of U.S which indicated that the world's largest economy grew by 2.2% against 2.8% previously. Speaking about domestic markets, bond yields closed flat as 10 year benchmark yields was quoting at 7.58%. The statement by Planning Commission Deputy Chairman Montex Singh Ahluwalia that monetary policy is no solution for food inflation raised speculation that central bank is prepared to raise interest rates. We continue to feel that the range bound movement will continue in USDINR with 46.60 as key support and 47.05 as key resistance level.