HALISTER1: India CPI at 22-Mo. High May Push NDF Below Fibo Level: Analysis

India CPI at 22-Mo. High May Push NDF Below Fibo Level: Analysis

(Bloomberg) -- USD/INR 1-mo. NDF could breach decisively Fibonacci support at 67.39 if India’s inflation rate matches or beats forecasts today, Bloomberg strategist Andrew Robinson writes.
  • Level represents 61.8% retracement of June 9-24 rally
  • Consumer prices probably rose 5.80% y/y vs 5.76% in May, median est. in Bloomberg survey shows; would be highest since Aug. 2014
    • Ests. range from 5.30% to 6.00%; data due 5:30pm Mumbai time
  • Goldman Sachs forecasts June headline CPI inflation at +6.0% y/y, mainly due to further up-tick in food inflation, particularly vegetables, according to note received July 8
  • NDF now at 67.47; if 67.39 level is breached convincingly, NDF could drop to 67.07 near term, which is 76.4% Fibonacci retracement of above rally
  • NOTE: Andrew Robinson is an FX strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.
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Source: BFW (Bloomberg First Word)

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