The Pound Sterling to Indian Rupee exchange rate advanced by more than 0.6% on Friday and surged to a high of 102.8800.
Although the Pound weakened against the majority of its other main currency counterparts in response to the UK’s disappointing Manufacturing PMI report, the British asset maintained a stronger position against a struggling Rupee.
The Rupee was languishing against the majority of its rivals despite India’s Manufacturing PMI surging to a 17-month high of 53.0 in July. This followed a reading of 51.5 in June and put the measure further above the 50 mark separating growth from contraction.
According to the report, increased demand saw companies step up production levels.
The data also detailed a slight reduction in employment and ongoing inflationary pressures.
In a statement issued with the data HSBC economist Frederic Neumann observed; ‘Finally, the manufacturing sector is starting to pick up steam. A flood of new orders from both domestic and external sources has led to a surge in activity, pushing the manufacturing PMI to a 17 month high. Details within the survey show that all monitored categories witnessed a rise in output and order flows. A quick word of caution, however. The speed of the recovery has also lifted price pressures, with input prices rising steeply. This means that the Reserve Bank of India may not cheer as loudly as the rest of us.’
The US Dollar to Indian Rupee exchange rate surged to a three-month high as this week’s run of positive economic reports for the US gave the ‘Greenback’ a boost and dampened demand for higher-risk assets.
The appeal of emerging-market currencies like the Rupee was further diminished as top ratings agency Standard & Poor’s asserted that Argentina had defaulted on its debt.
The US Dollar to Indian Rupee exchange rate hit a high of 61.0250.
The Rupee dropped by 0.4% during the local session and could fall further still if today’s US Non-Farm Payrolls report prints positively.
Pound Sterling to Indian Rupee Forecast
While the Pound is likely to maintain its present bullish relationship with the Rupee into the weekend, the British asset could shed gains next week.
Indian developments to look out for next week include the nation’s HSBC Services PMI and the Reserve Bank of India’s interest rate decision.
GBP/INR volatility is also likely to be triggered by a stream of influential economic news for the UK, including the nation’s NIESR GDP estimate for July and Construction/Services/Composite PMI.
If the UK fundamentals disappoint, the Pound could slide against peers like the Rupee.
However, we forecast that upbeat fundamentals from the US could caused additional, widespread weakness in the Indian asset.
The Pound Sterling to Indian Rupee (GBP/INR) exchange rate is currently trading in the region of 102.6710.
Indian Rupee (INR) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,
,Indian Rupee,102.6710,
US Dollar,,Indian Rupee,61.1300,
Euro,,Indian Rupee,81.8720,
Australian Dollar,,Indian Rupee,56.7500,
New Zealand Dollar,,Indian Rupee,51.6940,
[/table]
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