New Delhi: The Centre on Thursday expressed hope that India will not be impacted from the 0.25 per cent interest rate hike by US Fed. Chief economic advisor Arvind Subramanian noted that US Fed policy is being seen as “dovish” and will result in strengthening of Indian currency.
“I think what was interesting is that it's been seen as a dovish rate hike. That’s why the dollar actually declined a little bit and US bonds also declined,” he said. He also said that since US policy is seen as dovish, it should have little impact on the rupee and capital outflows.
“I think there should be very little volatility in the Indian markets... There's been pressure on the rupee to strengthen and I think that might continue to some extent," he explained. Meanwhile Economic affairs secretary Shaktikanta Das tweeted, “Indian markets (are) well placed to absorb the US Fed rate hike. Gradual approach in future increases augurs well for emerging markets.”
