GBP/INR forecasts change all the time, affected by news events and relative sentiment towards the UK and Indian economies and this exchange rate is even more volatile than usual because of the uncertainties around the Ukraine crisis.
The Ukrainian crisis and its risks for European energy supplies have pushed the Pound down against the Rupee.
GBP/INR started dropping in February and by mid-year the pound to rupee exchange rate has settled around the 96 mark, well down from its highs around 104 in April last year.
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Unlike Latin American countries, which continue to benefit from a U.S. recovery, Asian countries are vulnerable to economic austerity in Saudi Arabia and elsewhere in the Middle East due to the drop in demand for Oil during the Covid pandemic. More than 60% of remittances to India, Bangladesh and Pakistan come from Gulf countries.
The foreign exchange market convention for GBP/INR is to quote Indian Rupee as Rupee per US dollar. Thus a higher GBP/INR rate actually means one rupee is worth less, that is you can buy more rupee for 1 GBP.
The Indian rupee has steadily weakened all year (like most currencies) against the US dollar on fears that surging energy prices could spur inflation and interest rate hikes.
India imports most of its oil requirements and higher crude prices tend to push up domestic inflation.
The pound hit an all-time low (since decimalization in 1971) in late September of 1.03 against the greenback (1 USD = 0.97 GBP) — reacting to the controversial tax-cutting policies from the new chancellor.
The outlook for sterling against most currencies over the winter remains extremely challenging in its precarious post-Brexit/Ukraine war economic environment.
Disclaimer: Please note any provider recommendations, currency forecasts or any opinions of our authors should not be taken as a reference to buy or sell any financial product.