Among others, the INR has benefited from......>

INDIA: Among others, the INR has benefited from the weakness in the greenback

Tuesday and also plays catch-up after a market holiday Monday. USD/INR closed

just above last week's lows of 69.5013 Tuesday, with INR outperforming the

broader Asia FX space (KRW was the weakest). Today's trade cements USD/INR's

close below the 50-dma at 69.8589 after breaking above the mark last week.

-Markets continue to eye the poor performance in crude oil at the tail-end of

last week, but the boost for INR may be short-lived as energy prices recover

Monday and Tuesday so far. 

-Capital flow numbers remain critical for INR fluctuations, with numbers late

last week suggesting further foreign fund inflows into Indian equities and bond

markets. The NIFTY50 holds close to all time highs printed on Apr18 (closed

under 1% below Tuesday), but equities likely to be quiet for the rest of the

week on sporadic market holidays. USD/INR vols moderated further, holding the

recent pick-up on the 1-month measure as markets anticipate the election results

due on May 23rd.

-Indian markets are closed again Wednesday for May Day.