During local trading the Rupee rallied against the Pound and posted a modest gain against the US Dollar as an Indian wholesale inflation report showed that prices rose more rapidly-than-expected last month.
The Pound Sterling to Indian Rupee Exchange Rate was in the region of 101.0920 as of 10:30 GMT
The wholesale-price index climbed 7.52 per cent year-on-year, a 14-month high and up from an annual increase of 7 per cent the previous month.
Economists had forecast that the measure would come in at 7 per cent.
The unexpected result makes it increasingly likely that the Reserve Bank of India will be pushed into introducing an additional rate increase this week in order to subdue inflation fears.
Last week separate data revealed that consumer prices were up 11.2 per cent in November from the same period of 2012.
As Mumbai-based economist Suvodeep Rakshit observed; ‘The RBI can’t afford to sit pat when you have inflation surging. The central bank faces a difficult task as a major part of inflation is driven by food prices, over which it has little control.’
The Pound Sterling to Rupee (USD/INR) exchange rate hit a low of 100.6470
The wholesale-price index showed that food prices increased 19.9 per cent on the year.
After the data was published the Rupee strengthened slightly against the US Dollar and advanced on the Pound.
The emerging-market asset was previously able to gain against its British peer as UK house prices declined in December.
With the Reserve Bank of India delivering its rate decision on Wednesday and the Federal Open Market Committee gathering to discuss the prospect of tapering stimulus, significant Rupee volatility can be expected to occur over the next few days.
Additional GBP/INR fluctuations could also be inspired by tomorrow’s UK inflation report.
Current Rupee (INR) Exchange Rates:
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The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 101.0920 <
The Euro/Indian Rupee Exchange Rate is currently in the region of: 85.3148 >
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 61.8270 <
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 55.3871 <
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 51.2346 <
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 58.5287 <
(Correct as of 10:30 GMT)
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