The US Federal Reserve raised interest rates on 16 September, its first increase since 2023, and its own projections no longer show cuts next year.

This episode looks at what that means for corporate treasury in India: the Federal Reserve's own votes and projections, oil prices after the closure of the Strait of Hormuz, inflation, the Indian rupee and its forward premium, the Reserve Bank of India's currency swaps and forward book, Indian interest rates before the October monetary policy decision, and hedging decisions on imports, exports and dollar loans.

(00:00) Why hedging didn't follow the Fed

(00:46) How the Fed changed its mind

(02:40) Why our hedging cost went up

(05:34) What it says about rates and the rupee

(06:37) What I'd do on the desk

If you'd like a follow-up once the Reserve Bank has decided, let me know on LinkedIn or X.

Personal views. Not investment advice.

SOURCES

• Fed decision, vote records and projections — Federal Reserve press releases, FOMC minutes and Summary of Economic Projections, March to September 2026

• Oil prices through the first quarter — US Energy Information Administration

• Forward premia and Indian swap rates — FBIL published benchmarks; US Treasury yields — FRED

• Importer and exporter forward cover — Clearing Corporation of India data, reported by Reuters

• The Reserve Bank's deposit window, currency swaps and forward book — RBI announcements and the August 2026 Bulletin, reported by Business Standard and Reuters

• Indian rate expectations before the October policy decision — Reuters

• Removal of the hedging requirement on foreign currency borrowing, February 2026 — Khaitan & Co on the amended regulations

Figures are as reported. Check against the underlying data before relying on them.