GBP/INR Inches Up 0.40% in Early Trading

GBP/INR is in a bullish mood in early trading on Monday, after concluding a positive week. The pair is trading at 93.662, up 0.40% as of 6:45 AM UTC. On Friday, the pound closed 0.85% higher, which allowed it to recover about half of election losses.

The rupee has been increased pressure amid Indian economic slowdown. India’s gross domestic product (GDP) showed the worst performance in six years in the last two quarters. Judging by larger time frames, the pair has moved in a sharp uptrend channel since July 31, when the quotation fluctuated around 84.000. The pair has gained over 11.4% since then. The price hit the year-to-date peak at 95.412, right after the UK election when Prime Minister Boris Johnson secured a major victory.

Economists are now trying to figure out whether India has the potential to revive its economy in 2020.

Yesterday, the Confederation of Indian Industry (CII) said that India’s economy would rebound next year, driven by effective measures taken by the government and the Reserve Bank of India (RBI). The industry body suggested that the country would enter the new year with early signs of improving economy. CII stated:

“With the proactive measures taken by the government and the Reserve Bank of India (RBI), industry believes that the slowdown will be overcome, and a gradual recovery will soon be in place.”

CII President Vikram Kirloskar commented:

“Nascent signs of recovery are noted in the form of improved PMIs (Purchasing Managers’ Index) of manufacturing and services, jump in passenger air traffic, sharp moderation in the decline in sales of passenger cars, among others.”

According to Kirloskar, even though the economy might continue to note a subdued gross domestic product in the third quarter again, the quarters that follow will likely point to a rebound.

Despite the slight hopes of an economic revival, the rupee cannot make a stand against the pound. The British currency has been increasing against majors on easing worried about a potential no-deal Brexit. Right after the election, Johnson said that he wouldn’t allow the UK to extend the Brexit transition period, but European leaders hope he would change mind.

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