GBP/INR Exchange Rate Higher as world watches Scotland
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Despite the fact that the British domestic data was reasonably positive on Wednesday and there has been nothing in terms of Indian data, the Pound to Indian Rupee exchange rate is moving within a very narrow range. This is most likely due to continued trader anxiety over the fast-approaching Scottish referendum.
The Pound Sterling to Indian Rupee exchange rate is currently trending in the region of 99.2930.
Over the past month or so the Indian Rupee, amongst many other lesser currencies, has struggled against the intense, chart-topping bullish run of the US Dollar. As traders invested heavily on speculation that the Federal Reserve will tighten monetary policy in the near-future; the US Dollar has been all conquering. However, with Wednesday night’s Fed interest rate decision fast approaching, the US Dollar has softened amidst trader risk aversion strategies, and the Indian Rupee has benefitted from that decline.
Sterling’s declination has been well documented as trader anxieties over the forthcoming Scottish referendum have weighed increasingly heavily on the British currency. A confusing succession of Scottish independence polls, which have given different results and different margins, has only aided Sterling volatility.
Tuesday saw further Sterling weakness after inflation data showed the rate to be moving away from the Bank of England’s target. The effect of this was to snub hopes that the BoE would opt to hike rates sooner-than-anticipated.
The Pound Sterling to Indian Rupee exchange rate has hit a low today of 99.1510.
Wednesday’s British economic statistics have helped boost Sterling, although the gains are still restricted by the fears of uncertainty. Also today, the Bank of England published the minutes from their most recent monetary policy meeting. The minutes indicated that two of the policymakers voted against maintaining the benchmark rate at 0.5%. This aided the Pound’s uptrend a little although it may not be enough to spark renewed speculation that the BoE will raise rates in the foreseeable future.
Those invested in the Pound will have been buoyed by the unemployment rate which was seen to have fallen from 6.4% to 6.2%. However this positive result is somewhat marred by a less positive average weekly earnings report which showed 0.7% growth; the slowest increase since comparable records began. The continued lack of correlation between inflation and wages further decreases the likelihood of a bank rate revision.
With an absence of Indian economic data on Wednesday the Indian Rupee has been subject to movement provoked by foreign currency changes. In particular the softened US Dollar has given the Indian currency a boost as traders await the all important Federal Reserve decision on monetary policy.
The Pound was trading higher against the Indian Rupee on Thursday as the markets raised their expectations that the Scottish people would vote in favour of their country staying within the United Kingdom. With opinion polls, showing a slim lead for the no campaign investors have chosen to put their faith on such an outcome. With the polls too close to call however, we can expect the Pound to be jittery throughout the session. A yes win would likely see the Pound tumble sharply against all of its most traded peers.