"Consistency is what transforms average into excellence"
Domestic equities closed in the green yesterday and USDINR moved higher. RBI announced a 7 day variable rate repo auction for a notified amount of Rs 1.75 lakh crore on December 22. The LAF uptake as on Dec 20, was at 227K crore.
US2s10s bear steepened 2.40 bps. Implied Fed Fund Pricing was relatively unchanged. The U.S. data rhymed with the soft landing narrative. EURUSD got a boost from a hawkish comments while AUDUSD and USDCAD continued the outperformance.
On the data front:
ECB's de Guindos said "Once we see inflation is clearly converging in a stable manner to our target of 2%, monetary policy might then start to ease. But it’s still too early for that to happen."
Crude Oil Prices were capped at $ 80 a barrel as Reuters reported that Angola is leaving OPEC. The market took the news as suggesting that OPEC will now have less control over production levels. Angola produces about 1.1 mn bpd.
China banned the export of technology to extract and separate the strategic metals. U.S plans to raise tariffs on Chinese electric vehicles and other goods to enhance the competitiveness of US clean-energy products.
Today, we have the US PCE / Durable Goods Orders / India RBI MPC Minutes and UK Retail Sales data and GDP figures on the calendar. Liquidity will be thin going into the weekend on account of Christmas Holidays.
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