The GBP/INR price is correcting on Thursday after six straight bullish sessions that have sent it above 96.000. Currently, one British pound buys 96.103 Indian rupees, down 0.27% as of 6:30 AM UTC. On Wednesday, the pair almost hit 97.000, peaking at 96.968 and thus updating the highest level since March 10.
The price is now fluctuating close to the support line of an uptrend that got steeper at the end of May. If bears manage to break this support, then the rally may be interrupted.
The current bearish move might be driven by factors explained by technical analysis, as the pair required a correction sooner or later.
Fitch Expects Rapid Recovery for India
Meanwhile, rating agency Fitch said that India would manage to recover by displaying a sharp growth rate of 9.6% in the next fiscal year, following a deep contraction in the current year. India’s gross domestic product (GDP) is already experiencing the effect of the pandemic and lockdown measures. Fitch anticipates a 5% contraction by the end of 2020-21. Nevertheless, investors paid attention to the forecast for next year. Fitch said:
“After the global crisis, India’s GDP growth is likely to return to higher levels than ‘BBB’ category peers, provided it avoids further deterioration in financial sector health as a result of the pandemic.”
Fitch’s report that discussed India’s rapid recovery coincided with Brexit pessimism and a gloomy report on the UK’s housing market. Earlier Thursday, the Royal Institution of Chartered Surveyors (RICS) said that house prices tumbled to the lowest in 10 years in May. However, there are clear signs of recovery after restriction measures are lifted. RICS’ indicator of house prices fell to -32% last month, from -22% in April.
Expectations for house prices in 12 months increased to -5% in May from a record low of -94% in the previous month.
The sterling might be supported by talks about the next steps of lockdown easing. Prime Minister Boris Johnson announced yesterday that one-adult households would be allowed to visit other households indoors from Saturday.
“There are too many people … particularly those who live by themselves, who are lonely and struggling with being unable to see friends and family,” the PM said.