Good morning. Global monetary policy took a hawkish turn overnight, and the ripple effects are already showing up in currency and bond markets everywhere, India included. It has also been a noisy week in corporate boardrooms and courtrooms. Here is what is worth your time today.
In today's newsletter: the Fed's first rate hike since 2023 and what it means for the rupee, Oracle's layoffs finally land in India in a big way, and the Supreme Court draws a line on reopening old tax settlements.
Closing levels · 2026-09-16
Sensex 74,336.45 UP 0.45% |
Nifty 50 23,217.60 UP 0.43% |
USD/INR ₹95.95 DOWN, 6-week low |
Brent Crude $108.00 UP, elevated |
Benchmarks snapped a two-session losing streak on Wednesday, led by FMCG, realty and banking stocks, even as the rupee held near a six-week low and Brent stayed elevated on West Asia tensions. That calm may not survive the Fed's overnight move.
US Federal Reserve raises rates to 4%, first hike since 2023, as war-driven oil prices lift inflation
The Federal Reserve raised its benchmark interest rate by 25 basis points to a range of 3.75-4% on Wednesday, its first increase since 2023, in a unanimous decision that reversed months of expectations for cuts. Inflation has climbed to 3.4% in the US, driven largely by an oil price surge since Washington and Tehran began exchanging strikes in the Gulf. The Fed's own projections now point to the possibility of another increase before the year is out.
For India, the timing could hardly be worse: the rupee was already at a six-week low heading into the decision, weighed down by Brent near $108 a barrel and steady foreign investor selling. The RBI has been quietly selling dollars through state banks to slow the slide, and a stronger dollar globally, on top of the prospect of higher US rates for longer, makes that job harder just as India's oil import bill climbs.
After nearly three years of holding or cutting, major central banks are being forced back into inflation-fighting mode by a war that has nothing to do with monetary policy. That is a reminder that emerging markets like India remain hostage to a conflict thousands of kilometres away, however strong the domestic growth story looks on paper.
The bigger worry buried in the Fed's statement is not this hike, it is the next one: updated projections point to another increase before the year ends. If that materialises, the pressure on the rupee and on RBI's dollar reserves will not be a one-week story.
Oracle's job cuts spread to India as AI-driven restructuring deepens
Oracle's global layoffs that began in the US on September 14 have spread to India, with product engineering teams bearing the brunt of the cuts. Senior employees at Oracle Financial Services Software, the company's India-listed banking software arm, are among those who have received termination notices, some with immediate effect.
Estimates of the India headcount affected run as high as 3,000 employees, out of a global reduction Oracle sources put at 5,000-6,000 over a single weekend. The company has framed the cuts as part of a pivot toward AI infrastructure spending, a pattern now playing out across large technology employers as capital shifts from headcount to compute.
Supreme Court rules tax officers cannot reopen settled cases years later
The Supreme Court ruled on Wednesday that once the Income Tax Settlement Commission has finally decided a case, an Assessing Officer cannot reopen it through an ordinary reassessment notice. A bench of Justices S V N Bhatti and N V Anjaria dismissed the tax department's appeal against realty firm Omaxe, upholding a Delhi High Court order that had quashed the reopened proceedings.
The only route left for the tax department to revisit a settled case is to go back to the Settlement Commission itself and prove fraud or misrepresentation, the court held. For companies that used the settlement route to close disputes, some going back years, the ruling removes a lingering risk that assessing officers could reopen the books long after a case was considered closed.
Breaking.exe
AI fund closes. Aakrit Vaish's Activate closed its maiden venture fund at $105 million to back AI startups exclusively, positioning it as one of India's largest AI-focused early-stage funds after ten investments in nine months. |
OpenAI's valuation climb. OpenAI is weighing a new funding round that could value it at up to $1.5 trillion and has pushed its IPO to 2027, even as its own leadership continues to flag concerns about the pace of frontier AI development. |
Coforge boardroom exit. Coforge chairman O P Bhatt resigned after an internal audit found he had withheld a board evaluation report critical of his own performance from fellow directors. |
Chip summit opens. Prime Minister Modi inaugurated SEMICON India 2026 in Delhi, a three-day gathering of over 600 exhibitors meant to showcase India's semiconductor and electronics manufacturing push. |
Pangaea Revisited
Sweden's cliffhanger. Sweden pushed the final count in its knife-edge election to Thursday, with the centre-left opposition clinging to a narrow 176-173 lead over the sitting right-wing government as nearly 300,000 overseas ballots are tallied. |
Japan's reshuffle. Prime Minister Sanae Takaichi is retaining her key ministers, including the finance and foreign portfolios, in her first cabinet reshuffle as she tries to hold together support for her spending plans. |
Merz under pressure. German Chancellor Friedrich Merz won public backing from eight state party leaders after his conservatives were routed by the far-right AfD in a state election, with two more regional votes looming this weekend. |
Jakarta's reset. Indonesian President Prabowo Subianto abruptly replaced his finance minister, swapping in a veteran deputy seen as more market-friendly after a year of fiscal jitters and rating downgrades. |
Also, Also, Also
HDFC succession. HDFC Bank sent two candidate names to the RBI for its next MD and CEO, easing investor concern over a leadership vacuum ahead of Sashidhar Jagdishan's term ending next month. |
UPI fee stays. The government ruled out any rollback of the 0.4% merchant fee on UPI payments above ₹2,000, dismissing opposition criticism and trader protests ahead of the charge taking effect on October 15. |
Asian Games opener. India's campaign at the Asian Games began with teqball two days ahead of the formal opening ceremony in Aichi-Nagoya, while the cricket squad saw a late change after Varun Chakravarthy was ruled out with a side strain. |