The value of currencies of different nations are typically influenced by the same underlying economic conditions and policies. Several factors affect a currency's value, such as
One of the more common currencies traded on the foreign exchange (FX) market is the Pound sterling or GBP. It is the oldest actively traded currency on the FX market and the national currency of the United Kingdom. Another factor contributing to its appeal is the fact that London is one of the world's biggest FX centers.
A popular exotic currency pair on the forex market is GBP/INR. The GBP to INR exchange rate fluctuates as per the supply and demand on the global market, just like every other currency pair.
In this article, you will learn about the GBP to INR forecast for 2022, what's driving the movement of the currency pair, and a brief history of the GBP/INR exchange rate.
In India, the Whole Price Index (WPI) inflation rate significantly decreased from 13.56% in December 2021 to 12.96% in January 2022. However, after April 2022, the rates stayed in the double digits. It's interesting to note that it was 2.51% at the start of 2021.
The RBI is continuing its lenient policy in response to the rising inflation. In contrast to the Federal Reserve and the Bank of England (BoE), the Reserve Bank of India (RBI) is eager to stimulate economic growth even if it results in higher inflation in the coming months.
The central bank's benchmark interest rate remained at 4% in its most recent interest rate announcement. The recent interest rate decision by the RBI, which was dovish, will probably strengthen the currency pair.
Investors will be interested in the flow of money into the country in the upcoming months in addition to the fact that it is the top recipient of remittances globally. Trading Economics predicts that at the end of the current quarter, remittances to India will total $14.8 billion.
Remittances to India fell to $14.60 billion in the first quarter of 2022 from $15.11 in the fourth quarter of 2021. An increase in remittances is likely to support the Indian rupee and restrain the rise of the GBP/INR.
Learn more about the cheapest ways to send money to India from the UK.
The Office of National Statistics (ONS) revealed in early February this year that the UK's wage growth had decreased from 3.8% to 3.7%.
Additionally, compared to the prior decline of 51,600, the claimant count decreased by 31,900.
Claimant Count Change calculates the change in the number of unemployed people receiving unemployment benefits in the UK during the reported month.
To combat increased inflationary pressures, the BoE raised interest rates earlier in February of this year for the first time since 2004. BoE predicted that in April, inflation would be 7.25%.
The Monetary Policy Committee of the central bank decided to raise borrowing costs from 0.25% to 0.5%. Some committee members suggested an increase of 0.75%, which would have been much higher.
BoE is anticipated to increase the interest rate again, to 1% by May and 1.5% by November 2022.
The markets didn't expect these hikes to take effect before March 2023.
BoE's decision to change its hawkish stance from what was anticipated caused the GBP to INR exchange rate to reach a three-month high of 102.00 Rupees. Although the pair has already retreated, the central bank's switch to a more hawkish stance will likely strengthen the currency pair going forward.
Min-Max in INR
1 GBP/96.11 INR
1 GBP/93.41 INR
1 GBP/92.09 INR
1 GBP/92.09 INR
1 GBP/90.34 INR
1 GBP/90.34 INR
1 GBP/92.06 INR
1 GBP/92.06 INR
1 GBP/89.30 INR
1 GBP/89.30 INR
1 GBP/87.93 INR
Source: Pound Forecast
July 2022: At the beginning at 96.11 Rupees. At the end of the month 93.41. Maximum 97.39, Minimum 91.89. The average exchange rate is 94.70.
August 2022: At the beginning at 93.41 Rupees. At the end of the month 92.09. Maximum 94.16, Minimum 90.44. The average exchange rate is 92.53.
September 2022: At the beginning at 92.09 Rupees. At the end of the month 92.09. Maximum 92.09, Minimum 88.98. The average exchange rate is 90.88.
October 2022: At the beginning at 90.34 Rupees. At the end of the month 92.06. Maximum 93.44, Minimum 90.34. The average exchange rate is 91.55.
November 2022: At the beginning at 92.06 Rupees. At the end of the month 89.30. Maximum 92.06, minimum 87.96. The average exchange rate is 90.35.
December 2022: At the beginning at 89.30 Rupees. At the end of the month 87.93. Maximum 89.30, minimum 86.61. The average exchange rate is 88.29.
A long-standing and significant relationship between the Great British Pound and the Indian Rupee may be traced back to the colonial era.
India adopted a fixed-rate currency system, and the INR was linked to the British Pound. When India gained its independence from the British in 1947, the value of 1 pound was equivalent to 13.33 Indian rupee. At this time, the 1$ was equal to 1 Indian rupee, and 1 Pound was worth $4.03 at the time of independence.
The value of the Pound dropped, reaching $2.80 in 1949. As a result, the Indian rupee was also slightly devalued, falling from 13.33 to 13.30 to the Pound.
Until the period mentioned earlier, future devaluations of the Pound had no impact on its value because the Indian rupee was pegged to the US dollar until 1975.
In 1993, the RBI finally put an end to the fixed-rate currency regime and transitioned to a system where exchange rates are set by the market or are floating.
The 1 GBP to INR exchange rate mostly fluctuated between 64.10 and 72.35 Rupees between 1998 and 2002. Then, in late 2006, it rose to a high of 89.60 Rupees before reverting to the range mentioned above in 2010.
The rupee lost value from 65.17 in May 2010, rising to over 100 by 2013. After that, there remained downward pressure, which culminated in April 2017 with a five-year low of 79.53 Rupees.
GBP/INR has maintained a constant value of over 80 for five years following the subsequent rally. At the beginning of 2021, the currency pair traded at 100 or above.
The GBP to INR exchange rate peaked in April 2021 at 105.25 Rupees, setting a record high before dropping to below 95.
The exchange rate of GBP to INR today is 94.27 Rupees per 1 Pound as per Google. You can convert GBP to INR or INR to GBP with online conversion tools for free anytime.
The GBP to INR forecast for 2022 is influenced by the Reserve Bank of India's and Bank of England's (BoE) respective monetary policies, as well as the general health of both countries' economies and current geopolitical events.
In the coming months, the RBI will likely become less dovish as part of its efforts to deal with high inflation. This would limit the upward movement of the GBP/INR. At the same time, the currency pair is anticipated to rise as a result of the BoE's vigorous tightening of monetary policy.
However, the forecast is subject to change depending on the state of the market. Always conduct additional studies rather than simply relying on GBP to INR predictions made by analysts.
If you are looking to send money from the UK to India, where you have to consider currency exchange, compare GBP to INR exchange rates using CompareRemit today!
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