The US Fed will raise interest rates by 0.5% in March due to the Russia-Ukraine conflict


MUMBAI: Russia's attack on Ukraine has raised concerns that inflation could skyrocket, prompting the US Federal Reserve to raise interest rates by 0.50 per cent in its March monetary policy.

The rapid recovery in the economy, rising demand and the rise in crude oil have led to worries about rising inflation. Notably, inflation in the United States has reached a post-150 year high.

In addition to the Russia-Ukraine conflict, global stock markets have been on a sell-off for the past several months, following the possibility of an aggressive Fed hike by the US Fed. Foreign investors have been fearful of rising interest rates in the Indian stock market for the past five months.

The CME's Kheiguchabar tool shows that traders now see the US Central Bank raising interest rates by 20 basis points to only 4.5 per cent, as against the 5 per cent a week ago. Similarly, traders now firmly believe that the US Fed will raise interest rates by 3 basis points.

Global investment banks, such as Goldman Sachs, have warned that the US Federal Reserve could raise interest rates five times in 205, while Nomura warned of a 20 basis point increase at its March meeting.

Comments

Popular posts from this blog

Due to the ban, employment and economic activity declined by two to three percent

Information about soymilk and casein products

The brokerage firm objected to SEBI's new proposal regarding Algo Trading