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The yellow metal was down 0.60% on the week. The ten-year US yields fell 1.82% to 4.58% on Friday and slumped nearly 6% on the week. Likewise, the two-year yields settled 3% lower at 4.84% on the week. The US Dollar fell 1.07% to 105.06 on Friday as it recorded a weekly loss of around 1.50%.
The US central bank announced in a policy statement that it had decided to hold the policy rate steady in its current 5.25% to 5.50% range for now.
Does this mean India, with world-leading growth prospects by even the most conservative of assessments, is immune to the unrelenting northward march in global risk-free rates that are at their highest since the Global Financial Crisis? Well, not quite. Rather, a relatively circumspect pace of ascent for the US Dollar Index explains the soft landing in Indian equities thus far.
NSE's Nifty rose 177.5 points, or 0.91%, to close at 19,689.85. BSE's Sensex climbed 566.97 points or 0.87% to close at 66,079.36. Both indices had fallen over 0.7% on Monday as the escalation in geopolitical tensions in the Middle East resulted in oil prices surging.
This is how far back one must travel in time to understand the surging cost of funds in the world's biggest debt market, which determines how much companies from Jakarta to Johannesburg would pay to raise funds for anything: From something as mundane as staff wages and vendor payments to initiatives far more elaborate and capital-intensive, such as capacity generation and M&A.