Fed rate verdict, inflation data and oil prices set tone for short trading week

Equity markets will be closed on Monday for Ganesh Chaturthi, leaving the Fed’s policy decision and U.S. inflation report as the primary global catalysts for the week. The September 11 CPI data showed a 0.4% month-on-month increase, holding at 3.4% year-on-year, while core inflation eased to 2.4% annually, prompting analysts to watch for a potentially hawkish tone from the Federal Reserve. In India, rising Brent crude and any disruption to Middle-East oil flows pose an external risk that could lift inflation, expand the trade deficit and pressure the rupee.

Domestic indicators, including August WPI, CPI, unemployment and balance-of-trade figures, will further clarify the inflationary impact on the economy. Recent sessions saw the BSE Sensex fall 2.26% and the NSE Nifty slide 2%, extending a five-week losing streak amid global macro and geopolitical concerns.