US Fed rate hike : This will put pressure on the RBI to react as well by Sonam Srivastava, Wright Research
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Below is perspective on US Fed rate hike by Sonam Srivastava, smallcase manager & Founder, Wright Research
“The US FED raised the interest rates by 75 bps for the third time in a row. This move was driven by the worry about inflation in the US Economy. Initially the market reacted positively to this news of tightening monetary conditions. This is in fact because people were expecting a much severe rate hike of 100 bps. The US market ended drastically down due to the FED governor’s persistent call to keep growth low.
However, the rising of rates is not the best news, this will put pressure on the RBI to react as well to protect the INR and avoid financial stress. In such a scenario it is wise to avoid cash-burning businesses and businesses that have too high debt. The Indian market took a dip in the morning but then bounced back. Consumer sectors are leading the pack and this might continue to be the theme. The INR will stay under pressure till the RBI takes action.”
Above views are of the author and not of the website kindly read disclaimer
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