The Indian Rupee hit a five-week high against the US Dollar in early trading and held steady against the Pound after an exit poll showed that India’s main opposition party looks set to win the majority of states before next year’s national vote.
According to the poll, the opposition Bharatiya Janata Party is set to retain power in two states, win another and gain a majority in Delhi. The Party’s success is thought to be as a result of it choosing Narendra Modi who is credited for boosting GDP in Gujarat by 10% since 2001 and enticed international companies to the countries as its leader.
As a result of the polls release the Rupee climbed to its strongest level since October 31st.
Optimism is growing in India that the economy is starting to turn a corner following on from the summer’s dismal performance of the Rupee. The nation’s current account deficit has shrunk which has bolstered confidence despite the threat of the US Federal Reserve tapering its monetary stimulus programme.
“Markets have already been performing well in India on the back of the notion that a BJP government will move forward more aggressively with investment in energy, infrastructure and overall capex,” said Sacha Tihanyi, currency strategist at Scotiabank in Hong Kong, discussing a possible BJP victory in elections next year.
A national election will take place in 2014 and is expected to see current Prime Minister Manmohan Singh’s coalition struggle to secure victory in the wake of a number of corruption scandals and India’s weakest period of economic growth in ten years.
The Rupee could soften in the afternoon if GDP and jobless claims data out of the USA comes in better than forecasts as investors are likely to increase their bets that the Federal Reserve will choose to taper its monetary easing programme which benefits the Rupee.
Current Rupee (INR) Exchange Rates:
The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 101.0732
The Euro/Indian Rupee Exchange Rate is currently in the region of: 84.0733
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 61.8133
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 55.6994
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 50.6004
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 57.9411
(Correct as of 10:00 am GMT)
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