RESEARCH VIA FOREX REPORT 12 JUNE 2014

MARKET HEADLINES

Rupee marginally lower aginst dollar on subdued equitymarkets
Rupee was trading on a subdued note at 59.32 versus its close of 59.30 against dollar on Tuesday tracking weakness in equity markets in noon deals absence of any other major triggers also weighed. Traders expect the pair to trade in a broad range of 59.25 to 59.45 for the day. Traders will continue to monitor foreign fund flows into the debt and equity markets for near-term direction, while consumer price inflation data due on Thursday will also be watched. However, a large impact on the foreign exchange market is unlikely.

Euro dips in Asia ahead of ECB comments
The euro dipped in Asia on Wednesday as investors looked to comments from European Central Bank officials later in the day following the ECB's aggressive stimulus moves to combat the threat of deflation in the eurozone. In Tokyo afternoon trading, the European single currency slipped to $1.3537,
compared with $1.3545 in US trade, while it also weakened to 138.45 yen against 138.64 yen. The dollar slipped to 102.27 yen from 102.35 yen on Tuesday in New York. "Given the extremely light data calendar today, we expect range-trading," Credit Agricola said. "The market will await the ECB
officials to shed light on the details of the easing package in their speeches today." Last week, ECB policymakers launched unprecedented easing measures to bolster fragile euro zone growth, saying it would cut its deposit rate to negative territory. This means banks will be charged for leaving funds
at the ECB in the hope they might lend to businesses and consumers instead. The bank also slashed its lending rate to a record low of 0.15 per cent from 0.25 per cent and said hundreds of billions of Euros would be made available in cheap loans to banks as long as they lent more to the private sector. Bank
chief Mario Draghi said after the meeting that policymakers would also be open to possible asset purchases, or quantitative easing, similar to that undertaken in the United States and Japan. "It is very likely that selling pressure on the euro will intensify further," Junichi Ishikawa, market analyst at IG Securities, told Dow Jones Newswires.

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