INR finished the session slightly stronger....>

INDIA: INR finished the session slightly stronger against the USD despite the

RBI cutting rates by 25bps (alongside exp) and heavily suggesting further rate

cuts are forthcoming if the economy remains weak. INR rallied, while equities

(and, to a lesser extent, sovereign yields) slipped. This leaves USD/INR still

below the 50-dma at 69.5168, which appears to be becoming a firmer level of

resistance at present. 69.0387 (week's low) provides initial support ahead of

68.35.

-The RBI decision appears to have disappointed some who were eyeing a firmer

commitment from the board on addressing issues within the banking sector and

particularly liquidity management. Failure to address these topics further

(potentially via new liquidity operations as enacted ahead of the elections this

year) could further disappoint markets and lead INR higher still. Mirroring this

sentiment, NSE data today shows both domestic and global funds were net sellers

of equities Thursday.

-Attention turns to CPI, industrial production and trade balance figures due

next week.