Indian Rupee (INR) Exchange Rate Forecast
The Indian Rupee extended losses against the US Dollar (USD/INR) on Monday as the ‘Greenback’s bullish run continued and investors remained wary of the Rupee ahead of the Reserve Bank of India’s interest rate decision.
The Rupee is likely to experience some volatility later today after the RBI delivers its interest rate decision. It is expected that the RBI will leave the benchmark interest rate at 8.0%.
As stated by one Mumbai-based industry expert; ‘We do not expect any big announcements in the policy review tomorrow. Having said that we expect the Dollar-Rupee to stabilise at these levels, with the next resistance around 61.60/70.’
The Indian Rupee was also trending in a weaker position against the Pound on Monday, with the GBP/INR exchange rate achieving a high of 100.2230 even with the UK’s Mortgage Approvals report falling short of forecasts.
On Wednesday India will release its HSBC Manufacturing PMI. The index is expected to have risen from 51.6 to 52.4 in September.
The week’s final Indian reports (including Deposit Growth, Bank Loan Growth and Foreign Reserves figures) are all due out on Friday.
Today the UK’s final Q2 GDP figures could have an impact on the GBP/INR exchange rate and the US Consumer Confidence Index could impact USD/INR trading.
Euro (EUR) Exchange Rate Forecast
The Euro advanced modestly on both the Pound (GBP/EUR) and US Dollar (USD/EUR) on Monday after Germany’s Consumer Price Index printed slightly above expected levels.
German CPI came in at 0.8% on a year-on-year basis in September rather than sliding to 0.7% as expected.
Concerns regarding the protracted period of slow consumer price gains in the Eurozone and its largest economy have led to bets that the European Central Bank will roll out quantitative easing measures in the near future.
However, the steps already deployed by the ECB (including record low interest rates) appear to be aiding with the currency bloc’s inflation woes by undermining demand for the Euro.
Since the ECB announced the introduction of further stimulus earlier in the year the Euro has broadly softened, posting considerable losses against peers like the ‘Greenback’ and Pound.
As highlighted by economist Nick Matthews; ‘The ECB’s policy has been fairly effective in weakening the Euro. Clearly the exchange rate is one channel by which the ECB is measuring the effectiveness of its policy measures.’
Germany’s inflation data helped to counter the impact of a concerning Economic Confidence reading for the Eurozone and the Euro achieved a high of 0.7828 against the Pound and a high of 1.2715 against the US Dollar.
In the hours ahead Euro exchange rate movement will be caused by the Germany’s Unemployment Rate figure, the Eurozone’s Unemployment Rate number and the Consumer Price Index for the 18-nation currency bloc.
The Euro to Pound Sterling (GBP/EUR) exchange rate brushed a low of 0.7795 on Monday.
