Pound Sterling News: GBP INR Exchange Rate Losses Continue despite Positive Construction PMI Result
As foreign currency markets approach the end-of-week session, the British Pound to Rupee exchange rate continues to trend near its worst 2016 levels.
Sterling continued to be sold against most major rivals while the Indian Rupee continued to soar on the day’s RBI news.
GBP/INR hovered just above its worst 2016 levels on Wednesday afternoon. While Sterling was given a little more support by Bank of England (BoE) criticism from UK PM Theresa May, it struggled to capitalise against the strong Rupee.
Indian markets continued to cheer the decision made by the RBI earlier in the week as the Rupee continued to draw appeal despite higher prices of oil.
Although the Indian Services PMI for September bettered expectations this failed to offer any particular support to the Rupee on Wednesday morning.
As the PMI slowed from 54.7 to 52 this did not seem to bode overly well for the outlook of the domestic economy, particularly as markets remained in a generally risk adverse mood.
Even another increase in oil prices failed to keep the Indian Rupee in check as Rupee investors cheered the unexpected easing of the new RBI Governor’s first policy decision.
Contrary to market expectations, the Reserve Bank of India chose to cut interest rates by 25bpt to 6.25% at its October meeting, also indicating that its policy outlook remains accommodative.
As this rate cut aims to lower the domestic inflation rate towards the central bank’s target range this surprise move failed to offer the GBP/INR exchange rate any fresh rallying point on Tuesday morning.
Pound Sterling (GBP) has failed to make anything resembling a recovery today, having plummeted across the board on Monday.
In a continuation of the weekend’s negative response to Theresa May announcing when Article 50 would be triggered, the Pound posted additional losses against the Indian Rupee (GBP INR), US Dollar (GBP USD) and Euro (GBP EUR).
UK domestic data today has seen the construction PMI for September rise from 49.2 to 52.3, although this has failed to have any noticeable positive effect due to continued investor concerns.
Latest Pound/Indian Rupee Exchange Rates
On Saturday the Pound to British Pound exchange rate (GBP/GBP) converts at 1
The pound conversion rate (against pound) is quoted at 1 GBP/GBP.
The pound conversion rate (against euro) is quoted at 1.165 EUR/GBP.
At time of writing the pound to us dollar exchange rate is quoted at 1.255.
Please note: the FX rates above, updated 4th May 2024, will have a commission applied by your typical high street bank. Currency brokers specialise in these type of foreign currency transactions and can save you up to 5% on international payments compared to the banks.
British Pound Predictions: GBP Exchange Rates Expected to Worsen if Incoming Services PMI Declines
The next UK economic announcement likely to impact the Pound Sterling to Indian Rupee (GBP INR) exchange rate is tomorrow morning’s services PMI for September, which is presently predicted to dip from 52.9 to 52.5.
Despite the expected decline being only minor, this result could nonetheless have a prolonged negative effect on the Pound, due to the services sector being the largest contributor to the UK’s economic prosperity, even above yesterday’s manufacturing PMI.
Other UK economic events due in the near-term will include a speech from Bank of England (BoE) official Ben Broadbent on Wednesday morning, as well as Friday morning’s August trade balance, which has a deficit reduction as the expected outcome.
Indian Rupee Update: Crude Oil Price Drop Encourages INR Investment
The Indian Rupee (INR) has found itself in relatively high demand today, having recorded advances against the Euro (INR EUR) and US Dollar (INR USD), as well as the weakened Pound (INR GBP).
The latest Indian data came yesterday, when the Nikkei manufacturing PMI for September fell slightly from 52.6 to 52.1.
More encouragingly, however, the price of crude oil has recently dipped after a sustained few days of rallying, which has had the effect of increasing Rupee demand considerably.
Pound Sterling Indian Rupee (GBP INR) Outlook: RBI Interest Rate Decision Incoming, Services PMI Out Tomorrow
Further GBP INR exchange rate volatility is likely when the Reserve Bank of India (RBI) announces its interest rate decision for October.
On the month, a rate freeze at 6.50% is expected, while the simultaneously released cash reserve ratio is also expected to see no change at 4%.
Looking to Wednesday, the Nikkei services PMI for September is due to be announced early on, and has a dip from 54.7 to 51.5 predicted.
Pound Sterling (GBP) Focus: Widespread Pessimism on Future GBP Movement
Based on the forecasts of a number of economists, the future is not looking especially bright for the Pound, regardless of how today and tomorrow’s PMI results print.
Commenting on the historic lows of the Pound has been Societe Generale Global Fixed Income Strategist Kit Juckes, who has said;
‘Some sort of a bounce is possible today but the noises from the Conservative party conference aren’t helpful. There will be fiscal slippage as the Chancellor won’t try to hit previous deficit reduction targets, but a significant easing is not on the cards’.