The Indian Rupee strengthened against the Pound after the Indian Central Bank raised interest rates for a second consecutive month in a bid to tackle inflation which is threatening the Indian economy.
The Banks new governor Raghuram Rajan also rolled back emergency measures which were put in place in July in a bid to support the Rupee. The currency’s rapid devaluation has been halted by Rajan’s quick action since he took the top job at India’s Central Bank.
The RBI lifted the repo rate – the rate at which the Central Bank lends to commercial banks- by 25 basis points to 7.75%. The move was forecast by most economists. Despite the increase Rajan warned that inflation in the country is likely to remain stubbornly high despite the slowdown being witnessed in the Indian economy.
“Overall inflation is expected to remain higher than current levels through most of the remaining part of the year, warranting an appropriate policy response. The policy stance and measures are intended to curb mounting inflationary pressures and manage inflation expectations in a situation of weak growth. It is important to break the spiral of rising price pressures in order to curb the erosion of financial saving and strengthen the foundations of growth” Rajan said in a statement.
Against the US Dollar the Rupee has hit a one-week high as expectations grow that the US Federal Reserve will choose to delay tapering its monetary easing programme until next year, a move that benefits emerging market currencies such as the Rand. The Fed begins its two-day long policy meeting later on Tuesday.
Current Rupee (INR) Exchange Rates:
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The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 98.9337 <
The Euro/Indian Rupee Exchange Rate is currently in the region of: 84.6471 <
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 61.4944 <
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 58.5064 <
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 50.7903
(Correct as of 10:35 am GMT)
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