The oil prices steady eases the rupee

The recent bank strike has led to a lot of pent up demand for the dollar from the corporates causing the rupee to slide a bit from 46.31 to 46.35 today.

The rising oil prices have taken a break and settled for a while. This propels a positive sentiment but the fear of a further hike is still on the cards and the market will continue to be alert.

Having retraced the full amplitude of its move, the euro found a temporary bottom. The Euro-dealers are speculating the euro to fall through the psychologically important 1.2000 level. The unrelenting, 300 point move triggered by decline in oil prices and comments from Fed officials. The euro plunged without pause for 48 straight hours. The markets today saw first signs of respite as buyers finally appeared.

Today all eyes will be on US Durable Goods report which has taken on a magnified significance in light of Fed's persistent argument that US economic slowdown is "temporary". A weak report will see the euro back to its 1.2200 levels and a positive report above expectations will test the euro 1.2000 level. Most dollar bulls are pinning their hopes on the large Boeing orders which should help raise the goods report.

The possible drag of rising oil prices on business sentiment is drawing more concern for now and less certain that the US durable goods report will beat expectations.

The yen at 109 levels is testing the 111.00 levels expecting more fundamentals. Japanese Nikkei ends at a three week high on hopes of oil price downtrend.

The sterling also had a steep fall and is now holding at 1.7900 levels. Currently banks bid it back up to 1.7980. This move is attributed to the speculation that the Bank of England might not implement any more rate hikes.