Nifty Bank drops nearly 1,800 points amid RBI rate worries
Business
The Nifty Bank index has taken a sharp hit, dropping almost 1,800 points in two days and slipping below the key 54,000 mark for the first time since early June.
On Tuesday, it closed at 53,786, down over 1%, as investors worried about possible steep interest rate hikes from the Reserve Bank of India (RBI) and rising bond yields.
US yields, weak rupee, high oil
With the RBI's policy meeting coming up in early October, expectations are high for more rate hikes, possibly up to 125 basis points over the next year.
Rising US bond yields aren't helping either.
On top of that, the rupee has weakened against the dollar, and high oil prices are squeezing energy-importing sectors.
All these factors together have put extra pressure on banking stocks and made markets feel pretty uneasy.