The US Federal Reserve has raised rates for the first time since 2023, taking its main rate to 3.75% to 4%.
WHY IT MATTERS
US inflation is still above the Fed’s 2% target, while oil prices have crossed $100 a barrel.
Higher US rates can make dollar assets more attractive, strengthen the dollar and put pressure on emerging-market currencies and equities.
WHAT INDIAN INVESTORS NEED TO WATCH
- A weaker rupee can increase the rupee value of US investments
- Higher US rates can affect foreign flows into Indian markets
- Expensive oil can raise India’s import bill
- US stocks and growth-focused companies could face pressure from higher borrowing costs
With the RBI decision on October 7 and the next Fed meeting on October 27-28, the global rate story is far from over.
The question now: Is this just one hike, or the start of a new rate cycle?
Click to read full blog: How US Fed Rate Hikes Impact Indian Investors (2026 Guide)