It looks like there is a combination of factors coming together to boost the Indian economy — a good monsoon forecast, steady growth in areas of automobile and cement sales in the first quarter of the year, as well as India’s banks being in a better position to lend and spur growth after meeting the central bank’s requirements to earmark funds to shield themselves against bad, or nonperforming loans.
There are also expectations that in the next parliamentary session lawmakers may pass legislation that would allow the implementation of the uniform, countrywide Goods and Services tax next April. This could boost Indian economic growth by up to 2%.
On the other side, the AUD dollar had opened lower at .7329 on 18 May against the greenback, which had surged after the chances of US interest rate rises rose. RBA Monetary Policy Minutes were released 17 May, which provided a short lived boost for the Aussie but also showed a bit of disagreement from the RBA board in regards to the rate cuts earlier this month. But we all know that eventually they did cut rates by 0.25% but the disagreement did provide a relief rally following the release.
At the moment AUD/INR trading around 48.65 and AUD/USD is at .7266.
The writer is Senior Dealer Foreign Exchange with Compass Global Holdings Pty Ltd.
Priyanka Mehta is a Senior Foreign Exchange Dealer with Compass Global Markets which is one of the leading FX solutions provider to Individuals, Businesses, Importers, and Exporters in Australia.
For a professional and personalised service, please call Priyanka on 0421 699 620 or email at priyanka@compassmarkets.com
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