Uday Kotak warns of global turbulence, delay in rate cuts by Fed after US inflation data

Veteran banker and Kotak Mahindra Bank founder Uday Kotak has warned of global turbulence after the release of higher than expected US inflation data for March. The US inflation has now eroded hopes of an early rate cuts by the Federal Reserve.

Uday Kotak's warning

In a post in social media site X, Uday Kotak said that higher US inflation and Brent crude oil at $90 will keep the interest rates higher globally, including in India, for longer.

US inflation is higher than expected. Postpones US rate cuts to later, closer to US Presidential elections, if at all. Brent oil now $90. Will keep rates higher for longer worldwide including India. Only wild card: China imploding economically. Get ready for global turbulence.

— Uday Kotak (@udaykotak) April 11, 2024

He further predicted that rate cuts in US may happen closer to the US presidential elections.

Also Read: RBI Credit Policy: Repo rate unchanged at 6.5% for 7th time in a row

US Inflation in March

The US inflation for the month March rose to 3.5% annually compared to 3.2% in February. On Wednesday the US treasury yields surged while the equities recorded a fall after the data showing a higher US inflation was released.