The Reserve Bank of India, is not under pressure to raise interest rates in response to potential moves by the US Federal Reserve, according to V Anantha Nageswaran, India s Chief Economic Adviser. He stated that the RBI s policy decisions are less closely tied to the Fed s actions due to India s improved external finances and financial stability.
"Overall, the broader markets are still fine and healthy, and there s no need to panic. On the valuations front, some spaces seem to have run ahead of the valuations, especially in midcap space, which should get normalised with time. In the coming earnings season, we should see earnings catching up to the valuations. Coming to the corrections
The headline earnings decline worsened, but the details were more supportive for stocks. This week will be the second busiest of this earnings season. The Federal Reserve meeting on Wednesday will be closely watched despite the outcome being almost preordained.
as strong and tight, they are still worried about the impact on wage growth. so you do need to see further evidence. but we do expect next week to be the last fed hike and then you have several months of just pause and then in 2024, that would be the first rate cut to come. so you ve got these interest rate hikes that we ve been concerned about still working into the economy. the lag effect. but then we have something else that will be happening in a matter of weeks. student loan payments restart this fall. is that another economic headwind to be worried about in terms of consumer spending or is that too small a part of the economy to maybe risk consumer spending and growth? it is an important headwind to think about. there are a number of important headwinds just like that where you are starting to see the next couple of months where consumer head winds will start picking up a little bit. so the student loan issue is one of them. we also are expecting extra savings over the next q
The Federal Reserve has paused its hiking cycle at 10 interest rate increases, proposing two more hikes, with a target rate of 5.5-5.75%. Fed chair Jerome Powell has accepted inflation is still twice the target rate and that US banking regulation has been lacking. Though US job market trends show that Feds interest rate hike has not loosened enough to reduce inflation further.