Fed Rate Decision, Inflation Data, Oil Prices Set to Dominate Markets

The upcoming week promises to be eventful for global markets, particularly in light of several key economic indicators and geopolitical developments that are expected to shape market trends.

Equity markets in India will remain closed on Monday for Ganesh Chaturthi, but the day's absence from trading will not dampen the impact of other significant events.

The US Federal Reserve's monetary policy decision and commentary on future interest rates are expected to be major drivers of market movement. According to Ajit Mishra, SVP of Research at Religare Broking, this week will be dominated by the Fed's decision, which could have far-reaching implications for global bond yields and the dollar.

The US inflation data released on September 11 showed a 0.4 per cent month-on-month increase in headline CPI, while core inflation eased to 2.4 per cent year-on-year. The firmer monthly reading keeps inflation risks in focus, potentially reinforcing pressure on global bond yields and the dollar.

Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, notes that crude oil remains a significant external risk for India. Any renewed rise in crude prices could add to inflationary pressures, widen the import bill, weigh on the rupee, and squeeze corporate margins.