USD/INR Firmer In Early Trade, CPI On Tap & Critical To The RBI Outlook

USD/INR has opened at 82.70/75, ~0.3% firmer in today's trading. INR is following USD/Asia pairs higher as the greenback starts the week on the front foot.

• Dec Industrial Production printed below expectations on Friday at 4.3% vs5.0% exp. The prior number was revised higher to 7.3% from 7.1%.
• Equity Outflows continued, in the week up to Thursday ~$442mn in domestic equities sold by Global Investors. There was ~$450mn of bonds sold by overseas investors in the same period however the net amount sold in February is flat.
• Technicals remain bullish, bulls look to break high from 7 Feb (82.8) to target 83. Bears first target a break of the 20-Day EMA (82.18).
• On the wires today we have Jan CPI, the Bloomberg survey median estimate is 6.00% and the prior read was 5.72%.
• This will be closely watched by RBI observes given last week's hawkish +25bps hike from the central bank. The RBI stated sticky core inflation pressures were a key driver of the bank maintaining its 'withdrawal of accommodation" stance.