RSD: Still Seeing Upside

The Serbian dinar has twice failed to break through resistance at the RSD102.00/EUR level and has since retreated to trade at RSD103.40/EUR at one point on April 1. In the short term, we would target a move back towards key resistance at RSD102.00/EUR, implying gains of 1.38% from its current mark. Should we see a firm move through this level, we would look to see the dinar make up further ground versus the euro, targeting a move towards the key psychological level of RSD100.00/EUR. Fundamentally, we expect that increasing portfolio investment, which soared to an estimated EUR240mn in February alone (representing almost seven times the 2010 total), should keep the dinar well supported versus the euro.

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