The week so far has seen the Pound Sterling to Indian Rupee (GBP/INR) exchange rate rise steadily, although a significant setback was also seen in the rate yesterday.
This week, the Pound has fared well on a whole against the Rupee, although as mentioned, the path higher has not been a smooth one. Monday began with the Pound rising up to 99.4710 against the Rupee, although this was prior to the only major domestic data of the day, the Composite and Services PMIs for September, both of which printed below predictions. The Pound steadily dropped in the rate after this announcement, culminating in the worst posting of the week, 98.5579, being reached on Monday night. After this low, however, the Pound rose exponentially as oil prices surged by 5% and limited the appeal of the Rupee. Meanwhile, a positive assessment of the UK economy by the International Monetary Fund (IMF) lent Sterling support.
The Pound hit its weekly high against the Rupee today thanks to improved UK economic optimism, coming in at 99.6828 earlier in the session.
In addition to positive UK Manufacturing and Industrial Production figures out today, the GBP/INR pairing has been helped by the steadily rising price of crude oil per barrel since the beginning of October; the cost has risen from below $45.00 on October 1
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to almost $49.50 today, something that has progressively devalued the Rupee in the process. India’s domestic data has also worked against the Rupee, as the Nikkei Services PMI fell from 51.8 points to 51.3 yesterday. Also, while the IMF’s recent global forecast has predicted that India’s economy will grow by 7.5% in 2016, this news has been countered by the analysis by Moody’s Investors Service that historic terrorist attacks in India have severely hampered investor confidence and may have contributed to significant declines in economic development speeds over the decades.
For the rest of the week, Pound Sterling/Indian Rupee exchange rate movement may occur as a result of the UK RICS House Price Balance for September, the Bank of England’s (BoE) Interest Rate Decision on Thursday, the accompanying minutes for the decision which will be released simultaneously and the UK Trade Data, due on Friday.
Out early tomorrow, the RICS result currently has a positive prediction assigned to it, in the form of an estimated increase from 53% to 55%. More significantly, the BoE announcements (i.e the minutes) will be closely scrutinised by investors, as they could provide some clue as to whether policymakers will be raising the UK interest rate next year or in 2017 (which is the date being considered by some economists). Finally, Friday’s UK Trade Balance report is expected to show a widening of the nation’s deficit, but it is worth noting that the last postings in this field failed to meet with estimates.