Although the Rupee softened against its peers ahead of the publication of domestic trade balance data, the emerging market asset garnered support from the news that pro-stimulus candidate Janet Yellen has the President’s backing for the position of Chairman of the Federal Reserve.
The US Dollar to Indian Rupee Exchange Rate was in the region of 61.8600 as of 11:30 GMT
After posting an initial drop of 0.8 per cent against the US Dollar, the Rupee was also able to recoup losses as Reserve Bank of India Governor Raghuram Rajan intimated that he foresees India’s economy improving as a result of climbing exports and renewed investment projects.
While acknowledging the threat posed by political uncertainty in the US, Rajan stated; ‘We have two or three positives. One is stronger agricultural production. Second, the projects that have slowed or stalled coming on steam. Third is exports.’
The US Dollar to Rupee (USD/INR) exchange rate hit a low of 61.7200
This slightly brighter outlook for India was backed by an encouraging trade balance report.
The document showed that rallying exports helped the nation’s trade deficit narrow sharply, hitting a two-and-a-half year low and prompting this accompanying commentary; ‘This number strongly reinforces our expectation of a sub-$60 billion current account deficit for the full year, even after accounting for some pick up in gold imports in the next two months due to festive season demand. A lower current account deficit will also ease the RBI’s constraints on Rupee related concerns, which would help in reducing the exchange rate led inflation pressures and in turn help in limiting expectations over repo rate hikes.’
Exports jumped by 11 per cent last month, while imports declined by a whopping 18 per cent.
The report also saw the Rupee strengthen against a broadly softer Pound.
While developments relating to the US political stalemate and potential default could inspire significant market movement during the North American session, investors will also be looking ahead to tomorrow’s influential Indian data – industrial production and manufacturing output for August.
Current Rupee (INR) Exchange Rates:
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The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 98.8319 <
The Euro/Indian Rupee Exchange Rate is currently in the region of: 83.7090 <
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 61.8600 <
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 58.4577 <
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 51.2921 <
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 59.6230 <
(Correct as of 11:30 GMT)
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