- GBP/INR is traiding at 92.268, down 0.21% as of 6:26 AM UTC
- INR is looking more confident based on high hopes of a deal between US and China
- Indian economy was +5.0% in Q1 of the current fiscal year, which is the slowest pace in six years
- DBS Bank (Singapore) said that India’s GDP likely to slow down to 4.3% in Q3 2019-2020
GBP/INR is declining on Tuesday, as the rupee takes clues from the US-China trade talks news.
Thus, the quotation is switching from the bullish trend that took off last Friday.
The rupee is looking more confident amid increased hopes that the US and China would reach a phase one trade deal soon.
Earlier today, China’s Commerce Ministry revealed that top trade negotiators from both countries held a phone call, discussing “core issues of concern” and reaching a consensus on resolving relevant problems. The participants of the call were Chinese Vice Premier Liu He, US Trade Representative Robert Lighthizer, and US Treasury Secretary Steven Mnuchin. Other participants were China’s Commerce Minister Zhong Shan, PBOC governor Yi Gang, and vice head of state planner Ning Jizhe.
The call took place amid increased tensions between China and the US. Beijing announced earlier today that it had summoned US Ambassador Terry Branstad on Monday in a sign of protest after the US Congress passed the so-called Hong Kong Human Rights and Democracy Act — a bill meant to protect pro-democracy protesters in Hong Kong.
China’s foreign ministry stated that the US is trying to interfere in Chinese internal affairs. As of today, everyone is waiting to see if US President Donald Trump will endorse the bill.
Nevertheless, the Indian rupee might give up its bullish stance soon, as the focus now turns to the release of second-quarter GDP data, which is about to be published on Friday. The Indian economy added 5.0% in the first quarter of the current fiscal year, which is the slowest pace in six years.
Yesterday, Singapore’s DBS Bank said that India’s GDP likely continued to slow down to 4.3% in the third quarter of 2019-2020.
DBS Bank said in its report:
“Real GDP is likely to print 4.3 per cent YoY in 3Q vs 2Q’s 5 per cent, nearing the trough for this cycle.”
The bank argues that slowdown in consumption might turn into a major problem as private sector activity couldn’t increase the pace.