Top executives of the Punjab National Bank and the Oriental Bank of Commerce did not see an imminent rise in domestic deposit and lending rates due to the 0.25 per cent hike in Fed rates to 4.25 per cent.
"There will be no impact of Fed rate hike on domestic rates, as India's fundamentals are strong. However, we will take a view on NRI deposit rates shortly," PNB chairman S C Gupta told PTI in New Delhi.
Echoing the same sentiment, Oriental Bank of Commerce chairman K N Prithviraj said, "For NRIs, the US rates could become more attractive after the Fed rate hike. So there could be some indirect impact."
He said there could be some knee-jerk reaction in the bond market. "I don't expect much impact. We will watch the market situation in the next 5-7 days," he said.
Fed rate was hiked for the 13th time by 0.25 per cent to 4.25 per cent in a row to keep energy costs from spilling into the price of other goods and services.
OBC chief said it is very early to say how it will impact the economy and resources. He ruled out any direct link between Fed rates and domestic rates, which are determined by demand, supply and inflationary factors.
With IMD redemptions coming up later this month, he said OBC was studying the situation and will take a decision on rates going by market reactions.
IMD redemption may tighten liquidity situation, which may put pressure on domestic deposit and lending rates.
