Rupee to dollar outlook: Weak data from China can push Indian currency towards 61-mark

Updated: Apr 23 2014, 03:26am hrs
Seeing the rupee cross 60.80 was not surprising as Indian currency remains on a soft macro wicket and at the same time two major sources of US dollar weakness have more or less disappeared from the market, viz, speculative inflows leading upto elections and hot money inflow in the Indian debt market. The invisible hand of the central bank has been constantly mopping up the supply of the foreign currencies which keeps on seeping in due to the frenzy in the domestic equity market.

Tomorrow, the pair has to contend with a number of macro releases from major economies around the globe. The flash PMI survey data from manufacturing and services sector shall be released from China, Euro zone and US economies. We expect a weak data from China, which can once again push the Rupee towards the 61.00/10 levels against the Green back, but in case the Euro zone data holds up strong, then Rupee can claw back towards 60.80/60 region. There is little in the way of planned domestic market moving events, before the first exit poll results due possibly on or after 12th May. Therefore, for the remainder of the week, we expect range of 60.40/50 and 61.00/61.25 on spot.