Pound Sterling to Indian Rupee (GBP/INR) Exchange Rate – Rupee higher as inflation eases

The Indian Rupee pushed higher against the Pound and climbed to its highest level in over a month against the US Dollar.

The Rupee regained strength following last week’s disappointing jobs report out of the USA which showed that the world’s biggest economy added just 74,000 jobs in December, well below the expected figure of 197,000. Unemployment fell to 6.7% but that was as a result of more people giving up searching or looking for work.

The disappointing data saw the Rupee and other emerging and commodity based currencies rise against the Dollar as investors lowered their expectations that the Federal Reserve will not choose to taper it monetary easing programme further until the job figures improve.

Also supporting the Rupee was the release of data which showed that inflation eased in December. The fall in prices raised expectations that the Reserve Bank of India will keep monetary policy on hold for a second consecutive month when it gathers for a meeting on January 28th.

“A softer CPI is great for the Rupee. Going ahead, primarily the US economic condition will drive Rupee direction but a softer CPI will lead to better stability/appreciation and reduce chances of a sharper fall”, said the managing director at QuantArt Market Solutions.

The Rupee could gain further ground as the week progresses if data reports out of the UK and US show signs of a slowdown in their respective economies.