The Indian Rupee to US Dollar (INR/USD) exchange rate softened on Tuesday to 0.0167 after the latest manufacturing data release for the Asian nation saw activity in the sector slow in March. The INR to GBP paring also fell to 0.01.
The HSBC Manufacturing PMI dropped to 51.3 in March, down from the previous month’s one-year high level of 52.5. Orders for Indian goods from abroad increased at their fastest pace in close to three years but the overall new orders index fell to 52.7 in March from 54.9.
“The momentum in the manufacturing sector eased on the back of a slowdown in order flows and raw material shortages. Meanwhile, inflation also moderated,” said the chief economist for India at HSBC.
A positive of the data showed that inflation is likely to ease further over the coming months, potentially aiding the Indian economy.
Elsewhere the Reserve Bank of India chose to leave interest rates unchanged at 8%. The move was expected by economists.
RBI governor Raghuram Rajan expressed worries about potential risks to the Indian economy. He also said that he expects the nation’s economy to expand by 5 or 6%.
“Lead indicators do not point to any sustained revival in industry and services as yet,” Rajan said.
The Rupee does continue to find support from increased investor optimism and expectations that upcoming elections will lead to a change of government and lead to economic growth.
With a plethora of economic data releases today the Rupee is likely to experience movement.
Indian Rupee (INR) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,
,Indian Rupee,100.0200 ,
Euro,,Indian Rupee,82.6282 ,
US Dollar,,Indian Rupee,59.9450 ,
Australian Dollar,,Indian Rupee,55.6132 ,
[/table]
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