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#USDINR
Thread..
Pros:
1. Multifold Inflows ~= Outflows (of Tr Def & CA def).
2. RBI appetite for reserves reducing
3. Weak DXY
4. Hand of God levels (73-74)
Cons:
1. Crude 73+
2. Inflation > 6% yet MPC stance accommodative
3. GDP growth 🤞 (8-9% over 2020 which is ~ to 2019)
Thread..
Pros:
1. Multifold Inflows ~= Outflows (of Tr Def & CA def).
2. RBI appetite for reserves reducing
3. Weak DXY
4. Hand of God levels (73-74)
Cons:
1. Crude 73+
2. Inflation > 6% yet MPC stance accommodative
3. GDP growth 🤞 (8-9% over 2020 which is ~ to 2019)
4. Tr def, CA def.
5. Fiscal deficit
6. Rising commodity prices headwind for govt spending
Thoughts:
1. Reserves of over $150 Bn added within 24m
2. Avg cost 72-73
3. Appreciation contained, however one off one time Depn is tolerated
4. inflation counter by keeping ₹ stable?
5. Fiscal deficit
6. Rising commodity prices headwind for govt spending
Thoughts:
1. Reserves of over $150 Bn added within 24m
2. Avg cost 72-73
3. Appreciation contained, however one off one time Depn is tolerated
4. inflation counter by keeping ₹ stable?
5. Are we forming base at 73 for the next band at 75-78 from current band of 73-75 levels if,
Crude > 73
DXY > 92 (taper)
Inflation > 6 (with accom)
Growth < 9%
Fisc > 8%
6. Conversely, 73 is difficult to hold if,
FED shrugs taper
Inflation is transitory
Fisc ~ 7-8
Crude > 73
DXY > 92 (taper)
Inflation > 6 (with accom)
Growth < 9%
Fisc > 8%
6. Conversely, 73 is difficult to hold if,
FED shrugs taper
Inflation is transitory
Fisc ~ 7-8
