6 Mar 2014
Asia EM Express: India parliamentary elections set for April 7
FXStreet (Łódź) - On Wednesday the Election Commission of India said that parliamentary elections, the worlds largest with 814 million people entitled to vote, would take place on April 7 and the results would be made known on May 16. It is expected that Hindu nationalist leader Narendra Modi's Bharatiya Janata Party will win majority over the ruling Nehru-Gandhi family's Congress party.
Following the announcements street fights between supporters of Narendra Modi's Party and anti-corruption Aam Aadmi Party, whose leader had been detained by police during a campaign in Gujarat, Modi's home turf.
Despite the fact that religious minorities are concerned about Narendra Modi's Hindu nationalism and his connections to anti-Muslim violence in Gujarat in 2002, he is expected to defeat his main opponent Rahul Gandhi, whose family party's reputation had been tarnished by corruption scandals and accusations of not doing enough to boost growth in the country, which has been experiencing worst growth slowdown in a decade.
Meanwhile in China Shanghai the Chaori Solar Energy Science and Technology company announced on Wednesday that it was about to default on its 1 billion yuan bond interest payments, when it comes due on Friday. Even though the news perturbs the Shanghai markets, this first bond default ever in People’s Republic of China’s history, might in fact be a breakthrough event.
Allowing a company to default could be an important step for China on the path to becoming more open market. This way it would establish better debt pricing.
Economic data
India's current account deficit narrowed sharply to 4.0 billion dollars (which amounts to 0.8% of GDP) in Q4 2013 from 5.2 billion dollars (1.2% of GDP) in Q3. This improvement in the current account deficit in H2 2013 relative to 4.2% in H1 was maianly due to a reduction in gold imports, increase in exports and weak domestic demand.
According to Nomura's Aisia research Team: “Looking ahead, as long as domestic demand remains weak, gold import curbs continue and a reasonable export recovery persists – of all which should hold in the coming months – the current account deficit should remain in check.”
“We expect the current account deficit to be 1.9% of GDP in FY14, before rising to 2.5-3.0% of GDP in FY15 as gold curbs are removed and domestic growth starts to recover.”
Technicals
The USD/INR daily FXStreet Trend Index is slightly bearish, with the OB/OS Index neutral. RSI was neutral at 44.4148 at the last close. Daily 2-StDev Volatility Bandwidth expanded at 57 pips, with ATR (14) at 13 pips. The 1D 200 SMA was down at 6.1034, with the 1D 20 EMA at 6.1029.
The USD/CNY daily FXStreet Trend Index is stongly bullish, with the OB/OS Index neutral. RSI was neutral at 71.9126 at the last close. Daily 2-StDev Volatility Bandwidth shrunk at 2079 pips, with ATR (14) at 3565 pips. The 1D 200 SMA was down at 61.6446, with the 1D 20 EMA at 62.0471.
Following the announcements street fights between supporters of Narendra Modi's Party and anti-corruption Aam Aadmi Party, whose leader had been detained by police during a campaign in Gujarat, Modi's home turf.
Despite the fact that religious minorities are concerned about Narendra Modi's Hindu nationalism and his connections to anti-Muslim violence in Gujarat in 2002, he is expected to defeat his main opponent Rahul Gandhi, whose family party's reputation had been tarnished by corruption scandals and accusations of not doing enough to boost growth in the country, which has been experiencing worst growth slowdown in a decade.
Meanwhile in China Shanghai the Chaori Solar Energy Science and Technology company announced on Wednesday that it was about to default on its 1 billion yuan bond interest payments, when it comes due on Friday. Even though the news perturbs the Shanghai markets, this first bond default ever in People’s Republic of China’s history, might in fact be a breakthrough event.
Allowing a company to default could be an important step for China on the path to becoming more open market. This way it would establish better debt pricing.
Economic data
India's current account deficit narrowed sharply to 4.0 billion dollars (which amounts to 0.8% of GDP) in Q4 2013 from 5.2 billion dollars (1.2% of GDP) in Q3. This improvement in the current account deficit in H2 2013 relative to 4.2% in H1 was maianly due to a reduction in gold imports, increase in exports and weak domestic demand.
According to Nomura's Aisia research Team: “Looking ahead, as long as domestic demand remains weak, gold import curbs continue and a reasonable export recovery persists – of all which should hold in the coming months – the current account deficit should remain in check.”
“We expect the current account deficit to be 1.9% of GDP in FY14, before rising to 2.5-3.0% of GDP in FY15 as gold curbs are removed and domestic growth starts to recover.”
Technicals
The USD/INR daily FXStreet Trend Index is slightly bearish, with the OB/OS Index neutral. RSI was neutral at 44.4148 at the last close. Daily 2-StDev Volatility Bandwidth expanded at 57 pips, with ATR (14) at 13 pips. The 1D 200 SMA was down at 6.1034, with the 1D 20 EMA at 6.1029.
The USD/CNY daily FXStreet Trend Index is stongly bullish, with the OB/OS Index neutral. RSI was neutral at 71.9126 at the last close. Daily 2-StDev Volatility Bandwidth shrunk at 2079 pips, with ATR (14) at 3565 pips. The 1D 200 SMA was down at 61.6446, with the 1D 20 EMA at 62.0471.