The current week has seen the Pound Sterling to Indian Rupee (GBP/INR) exchange rate progressively worsen over time, with the starting high on Monday of 98.4698 quickly giving way to a worse closing rate today of 97.2776. This deterioration of the Pound has largely been due to UK data, although historic shifts in the price of crude oil have also benefitted the Rupee.
The week’s UK news has largely been negative in tone, in terms of both direct releases and in wider events pertaining to the UK economy.
Monday saw the Pound hampered by a drop in the UK December Manufacturing PMI from 52.5 to 51.9, while the Construction variant released a day later lightened the mood by rising from 55.3 to 57.8.
Yesterday was an unusual day for Sterling, which largely managed to rally in spite of both the December Composite and Services PMIs falling on previous printings.
But today has been largely negative for the Pound, which has tanked due to a string of events reducing the currency’s appeal. The main event has been the news that Chancellor George Osborne will be delivering a speech outlining the various threats and dangers facing the UK economy. Even before its delivery economists have been greatly concerned by the atmosphere and have abandoned Sterling in droves.
India has had relatively few economic releases, except for Monday’s Nikkei Manufacturing PMI and Wednesday’s Services variant, which have respectively risen and fallen compared to the previous result. The price of crude oil has acted as a supporting factor for the Rupee, having fallen below $33.00 per barrel this week.
For the remainder of this week and the beginning of the next, Pound Sterling/Indian Rupee exchange rate movement may occur as a result of tomorrow’s UK Balance of Trade results for November plus India’s Bank Loan/Deposit Growth and Foreign Reserves reports.
Tuesday will see the next economic publications of note, with the UK’s annual December BRC Like-for-Like Sales coming early. Later the UK’s Industrial and Manufacturing Production results for November will be released, along with the NIESR GDP Estimate for the past month.
From India, Tuesday will see the release of annual November Industrial and Manufacturing Production results as well as the December yearly Inflation Rate. Unfortunately for the Rupee, at the time of writing forecasts were for declines in all results.
In addition to these scheduled releases, the pairing is also likely to be moved by the price of crude oil, which will continue to raise the value of the Rupee if it fails to make a distinct recovery.