GBP/INR is Flat on Wednesday as Markets Discuss BoE’s Potential Decision

GBP/INR is moving sideways on Wednesday, after falling over 0.50% yesterday. Currently, the pair is trading at 92.718, down 0.02% as of 6:00 AM UTC.

The markets are watching the developments of the outbreak of a new strain of a coronavirus in China and the Brexit, which is about to occur this Friday.

Earlier today, the British Retail Consortium (BRC) said that the rate of decline in shop prices slowed this month. The indicator declined by 0.3% compared to January 2019, after a 0.4% decline in December.

Mike Watkins of Nielsen, which also took part in conducting the survey, stated:

“There is no inflationary pressure coming from the high street as shoppers remain nervous about spending and discounting continues for many non-food retailers. Whilst promotions in supermarkets have returned to more normal levels post-Christmas, the sector remains embattled with fierce price competition which looks set to continue.”

Prices over the previous six months had declined by 0.5% year on year.

Yesterday, the Confederation of British Industry (CBI) published its survey findings on retail sales, which showed no change in consumer spending this month, which continues to be weak. CBI’s index comes ahead of the Bank of England’s (BoE) decision on the interest rate.

Howard Archer, an economist at the EY ITEM Club consultancy, commented:

“The CBI distributive trades survey pointed to stable, lacklustre retail sales in January, thereby suggesting that the decisive general election result failed to give an imminent boost to consumer spending.”

JPMorgan economist Allan Monks said that he didn’t expect the BoE’s Monetary Policy Committee (MPC) to cut the rates tomorrow, citing signs of increasing confidence, and positive data in the housing and labor markets.

CBI’s data was regarded as somewhat positive given that sales used to decline in the first month of the year. Also, for the three months to January, CBI’s measure of retail sales was the strongest in a year.

The survey was based on the responses of 51 retailers between December 16 and January 14. The survey coincided with the Christmas holiday and Boxing Day.

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