look news india
Fed Reserve Rate Announcements: Federal Reserve officials have kept interest rates unchanged for the sixth consecutive meeting. It has also indicated that there are no plans to raise interest rates in the near future as inflation remains higher than expected. The Federal Open Market Committee's target range for the benchmark rate is 5.25 percent to 5.5 percent. Which reached the peak of two decades in July. The pace of the balance-sheet reduction program will be announced. President Jerome Powell will hold a press conference.
Fed will keep rates on hold until inflation comes under control
The US Federal Reserve has said that there will be no reduction in borrowing costs until inflation stops at 2%. The current rate is suitable for the strong economy of the country. The rate cut had already been announced by the Fed. But due to geopolitical crisis, no cuts were asked this year.
Fed's wait and wait policy
“This message from the Fed reflects a wait-and-see policy,” said Michael Gapen, head of US economics at Bank of America Corp. The policy requires more time to operate. According to him, no decision will be taken until inflation is completely controlled.
What is the impact on Indian stock market?
Foreign investors can withdraw funds from the Indian equity market as the interest rates are maintained by the Federal Reserve. However, with no increase in interest rates, FPI selling may remain limited. The dollar index will strengthen, which will reduce demand for the precious metal. As a result, the price of gold and silver may also decrease at the local level. US Treasury yields will also increase. Therefore, foreign investors would prefer to invest in the American market instead of investing in India for 10 to 12 percent returns.