US Federal Reserve hikes interest rates – but will RBI follow suit?
The US Federal Reserve raised interest rates by 25 basis points to a range of 3.75-4% on Wednesday, marking the first increase in three years, according to the FOMC. All 12 FOMC members, including new Chair Kevin Warsh, voted in favor of the hike. The decision was met with criticism from the White House, which called it "rather unfortunate" and lacking a compelling economic case.
The Fed, however, stated that US economic activity is expanding at a "solid" pace, with strong productivity growth and robust capital investment. Inflation remains elevated, and the Fed aims to bring inflation back to its 2% target. The Fed is expected to raise rates again before the end of 2026. Other central banks, including those in the UAE, Bahrain, and India, also raised interest rates on Wednesday, as did the Bank of Japan.
India's inflation remains a concern, with the RBI's Monetary Policy Committee expected to raise rates by 25 basis points on October 5-7, taking the repo rate to 5.5%.
Written by urgent.news from The Indian Express's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
