The Rupee may have enjoyed a rally yesterday, but the appeal of the emerging market asset dipped overnight as the odds of the Federal Reserve tapering stimulus increased and oil marketing companies bought up Dollars.
The Pound Sterling to Indian Rupee Exchange Rate was in the region of 100.4760 as of 10:00 GMT
India’s currency edged lower against a broadly strengthening US Dollar as Federal Reserve Bank of St Louis President James Bullard supported the case for the Fed trimming easing in the near future.
Bullard referenced last Friday’s impressive US non-farm payrolls report and stated; ‘A small taper might recognise labour-market improvement while still providing the committee the opportunity to carefully monitor inflation during the first half of 2014. Should inflation not return toward target, the committee could pause tapering at subsequent meetings.’
Although taper expectations have largely been priced in, the Federal Open Market Committee is scheduled to meet next week and if it announces a December taper the Rupee could weaken.
The Rupee also softened against the Pound today as UK industrial and manufacturing production figures met estimates.
The Pound was already riding high after a UK housing report showed a surge in prices and the British asset went on to consolidate gains against peers like the Rupee as a separate report showed that UK industrial production increased for a second month.
The Pound Sterling to Rupee (USD/INR) exchange rate hit a low of 100.1110
However, some industry experts are predicting that the Rupee has a positive path ahead of it.
In a recent article for MoneyControl, currency expert Brijen Puri commented; ‘we are at a far better starting point today than we were early last year when Fed Chairman Ben Bernanke announced the first indications of the taper. Therefore, given the improved underlying factors for the Rupee, given the momentum, in the short-term while Rupee would depreciate should emerging markets also depreciate in response to the taper, I would like to think that Rupee would probably outperform its peers and therefore not depreciate as much.’
As the week progresses further Rupee movement could be triggered by tomorrow’s Indian trade balance data and Thursday’s manufacturing/industrial production and inflation reports.
Current Rupee (INR) Exchange Rates:
< Down > Up
The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 100.4760 >
The Euro/Indian Rupee Exchange Rate is currently in the region of: 84.0507 >
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 61.1700 >
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 55.6404 >
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 50.7251 >
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 57.4826 >
(Correct as of 10:00 GMT)
Comments are closed.