America's decision is a crisis for India..!? What will happen..?

frame America's decision is a crisis for India..!? What will happen..?

Sowmiya Sriram
America's decision is a crisis for India..!? What will happen..?

The American stock market and the Asian markets continue to suffer a major decline due to the higher-than-expected inflation in the united states in August. While europe and britain are raising interest rates one after the other, it has been reported that india is also planning to raise the interest rate by 0.50 percent at the end of this month. Rising inflation has become a major headache for the country's government and the Federal Reserve.
In this situation, it is expected to raise interest rates soon to control inflation. If the united states raises the interest rate in such a way, it will have a great impact on India. In august, US inflation was predicted to be 8 percent, while the country's labor department announced that it was 8.3 percent. Since this announcement, there has been a continuous decline in the stock market from America to Asia and Europe.
Investors and economists are expecting the Federal Reserve to raise interest rates soon as US august inflation is close to June's peak of 9.1 percent. Thus, the US Federal Reserve is expected to raise interest rates by 0.75 percent at its september 21 monetary policy meeting. If this happens alone, the rupee has already depreciated by 6.5 percent against the dollar in 2022 and is likely to further depreciate.
At the same time, the global bond index, increase in investment in india, increasing trade deficit, and discount in crude oil price will protect the rupee from a big fall.
As a result, India's economy and growth are likely to stagnate. As festive sales and discounts heat up, the RBI is likely to raise the repo rate by the end of this month to 0.50 percent to curb inflation. This will cause a big change in the festive season sales.
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