GBP/INR couldn’t break above the resistance of a sideways channel that formed in mid-December and is now pulling back. At the time of writing, one British pound buys 99.867 Indian rupees, down 0.11% as of 7:50 AM UTC. On Wednesday, the pair almost updated the highest level since the summer of 2016 at 100.315 but failed to break the resistance once again.
The pound’s ambitions faded after separate data from the British Retail Consortium (BRC) and the Confederation of British Industry (CBI) showed that UK retail sales saw the biggest drop since May this month, as non-essential stores are closed due to the national lockdown.
Earlier today, the Royal Institution of Chartered Surveyors (RICS) said that Britain had experienced the biggest increase in vacant shops in more than 20 years in 2020. The country also saw the largest increase in empty offices. Instead, the demand for industrial space is increasing, as many businesses behind online shops are looking for warehouses.
RICS economist Tarrant Parsons said:
“Both the office and retail sectors continue to see occupier and investor demand diminish, with expectations for rents and capital values remaining deeply negative for the time being.”
UK Lockdown Until March, Johnson Says
Even though the UK is rolling out the COVID vaccines at the highest pace in Europe, the strict lockdown is here to stay for months. Yesterday, UK Prime Minister Boris Johnson said that the restrictive measures would last until March 8. On Tuesday, the death toll exceeded 100,000, which is the highest figure in Europe.
Meanwhile, Britain is in talks with Switzerland for a financial services deal and is focusing on the next free trade agreement with Australia.
In India, the Commerce Ministry said that Foreign Direct Investment (FDI) surged in November of last year by 81% to $10.15 billion compared to $5.6 billion in the same month of 2019. FDI equity also surged by 70%. The country has attracted total FDI inflow of over $58 billion in the eight months to November 2020, which is the highest ever for the period. FDI is an important driver for India’s economic growth.