Gold Silver Reports (GSR) – Volatile Session Seen For The Rupee – Karnataka results will come out on Tuesday and exit polls over the weekend showed that the Bharatiya Janata Party is likely to emerge as the single largest party winning anywhere between 95-120 seats. If BJP forms the government, investors expect the rupee to appreciate to Rs 66.60 a dollar as political risk premium will reduce. However, if Congress retains the state, the pair can surge to Rs 68.30 levels.
It is likely to be a volatile session for both the bonds and the rupee. Elections and CPI inflation data are the top two things on the minds of investors today.
On the other hand, CPI likely rose to 4.42 percent in April according to a Bloomberg survey. Retail inflation was at 4.28 percent in March. The yield on the benchmark bond is 7.73 percent, near the same levels before the RBI announced its decision to buy debt. For today, it is going to be a volatile session with yields moving in a range of 7.70-7.75 percent. – Neal Bhai Reports (NBR)
