Financial NewsForex Updates

Indian Markets Well Placed to Absorb Federal Rate Hike

Federal Rate HikeIndian stock markets are fairly placed to absorb the 0.25% bps interest rate increase by the US Federal on Wednesday night. Stocks opened in the positive note as the Sensex was trading 206.40 points up at 29,604.51 in the morning. The Nifty put up a good show by surging a new intra-day high. The Indian rupee, which continued with its strong performance by appreciating another 47 paise to hit a new 16-month high at 65.22 against the U.S. dollar in early trade on Thursday.

Indian markets are well placed to digest the US Federal rate hike. As widely expected, the Fed Reserve raised its benchmark interest rate for the second time in 3 months and predicted 2 additional hikes this year. The Federal’s key short-term rate is up by a quarter-point to a still- low range of 0.75% to 1%.

The Federal Open Market Committee (FOMC) in its account last night indicated that In view of realized and expected labour market conditions and inflation, the FOMC decided to raise the target range for the federal funds rate, near-term risks to the economic outlook.

Global Gold hit a one-week high today, 16 March, 2017 after the U.S Federal Reserve cued a cautious standpoint on interest rate policy this year, pushing the dollar to its lowest in a month. Spot gold rose 0.5% to USD 1,224.70 per ounce in the morning after touching USD 1,225.76, the highest since 7 March.

Platinum was up 1.5% at USD 962.99 per ounce, close to USD 968.20, its highest hit earlier in the day.