Pound Sterling to Indian Rupee (GBP/INR) Exchange Rate Forecast: Pairing Fell Further after RBI Interest Rate Cut
On Thursday morning the GBP/INR conversion rate has begun to regain some ground ahead of the release of the September UK Manufacturing PMI, rising in the region of 99.2780.
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In spite of some positive UK data today, the GBP/INR conversion rate has continued to slump in the face of a strengthened Rupee (INR).
Shock Interest Rate Cut from Reserve Bank of India (RBI) Saw Rupee (INR) Surge across the Board
Though yesterday saw the Pound (GBP) climb against a majority of its rivals thanks to improved UK Mortgage Approvals and CBI Reported Sales figures, the GBP/INR exchange rate remained on a persistent downwards trend. This was due to the Reserve Bank of India (RBI) surprising investors with an interest rate cut 0.25% larger than had been forecast, lowering the nation’s cash rate to 6.75% in a move that saw the Rupee (INR) strengthen across the board. Resulting from the increased economic pressure exerted by neighbouring China and worries of a 2015 US interest rate hike from the Federal Open Market Committee (FOMC), this measure aimed to better insulate the emerging market currency from negative global headwinds. In a somewhat counterintuitive result, this loosening measure boosted the appeal of the Rupee, due to the persistent optimism with which the strength of the Indian economy is currently regarded.
Sterling (GBP) Bolstered by Narrowed UK Current Account Deficit as GBP/INR Pairing Held on Downtrend by Dominant Rupee (INR)
While the second quarter UK Gross Domestic Product was revised down from 2.6% to 2.4% for today’s finalised figure, any significantly negative impact was mitigated by the revelation that the nation’s Current Account deficit has narrowed substantially further than expected. Dropping to a two-year low, this indicated that the economic health of the UK remains fairly robust, being spurred by a higher level of domestic exports and easing some of the pressure upon the Bank of England (BoE). In spite of Pound sentiment generally picking up, however, the GBP/INR conversion rate continued on a marked downtrend throughout the day to strike a monthly low of 99.3421.
GBP/INR Exchange Rate Forecast: Upcoming Manufacturing PMIs to Decide Direction of Pairing Movement
The Indian Manufacturing PMI due out on Thursday is anticipated to post a minor decline from 52.3 to 52, which could put an end to the current bullish run of the Rupee. Nevertheless, should production in the sector be shown to have increased, or just declined by a lower degree, the GBP/INR currency pairing would be likely to remain in a slump.
Both the UK’s Manufacturing and Construction PMIs are also due for release ahead of the weekend and may provide a stronger rallying point for the Pound. Continued signs of domestic economic improvement would undoubtedly encourage a renewed surge of confidence in Sterling, potentially offering the momentum necessary to boost the GBP/INR conversion rate away from fresh lows.
Current GBP, INR Exchange Rates
At time of writing, the Pound Sterling to Indian Rupee (GBP/INR) exchange rate remained in a substantial downtrend around 99.2130, while the Indian Rupee to Pound Sterling (INR/GBP) pairing continued to climb in the range of 0.0101.