Andy Mukherjee: India’s love for equity is being tested—can the US-Iran ceasefire restore confidence?
A lot is riding on the two-week ceasefire in the Gulf conflict. If the Strait of Hormuz reopens quickly and fully, India’s fiscal and current-account deficits may be elevated, but manageable. However, prolonged energy shortages could upend those calculations and the Reserve Bank of India, which left interest rates unchanged on Wednesday, may have to raise them to prevent an unruly collapse of the currency.
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