- Pound (GBP) underpinned by reopening optimism
- UK covid cases drop sharply
- Indian Rupee (INR) holds its ground despite surging covid cases
- RBI foreign exchange reserves increase by $233 million
The Pound Indian Rupee (GBP/INR) exchange rate is holding steady at the start of the week. The pair edged 0.3% lower across the previous week, its fourth straight week of losses, closing on Friday at 100.09. At 08:45 UTC, GBP/INR trades flat at 100.08
The Pound is underpinned by an improving UK economic outlook, despite recent data painting a mixed picture. Data last week revealed that UK inflation was weaker than expected, which means there is less chance of the Bank of England raising interest rates soon.
On the other hand, the strong vaccine rollout programme, improving covid numbers and the economic reopening boosting demand for the Pound. Over 30 million Britons have had their first covid jab. New daily covid cases in the UK fell by a third across the last week to 3,862. Covid related deaths dropped 42% over the week to 19, indicating the vaccine is having the desired effect.
Today the UK takes its next step along the re-opening roadmap as UK’s stay at home order is lifted. In England, groups of 6 can meet outside. Non-essential retailers will re-open in two weeks. A strong consumer led recovery is expected over the coming months.
There is no high impacting UK data due to be released today. UK housing data and business investment numbers will be in focus.
Meanwhile picture in India is quite different. Covid cases are rising again as a second wave sweeps the country. The richest state, Maharashtra is considering a total lockdown this week after recording its highest one day jump in cases by anu Indian state since last March with 40,414 news cases.
At the end of last week, data released by the Reserve Bank of India revealed that the countries foreign exchange reserves rose by $233 million to $582,271 billion in the week to March 19.
Looking ahead, there is no data due to be released today. Investors will focus on current account numbers due on Wednesday.