Rajan urges Fed rate hike at Jackson Hole

At the Jackson Hole economic symposium, former State Bank of India governor Raghuram Rajan, now co-leading a United States — Federal Reserve task force on balance sheet policy, publicly urged the United States — Federal Reserve to raise interest rates to combat elevated inflation. Rajan stated he would be more hawkish than the current Fed stance, citing strong data-center investment, persistent fiscal deficits, and resilient consumer spending as evidence that financial conditions are not restrictive enough. He also defended Fed Chair Kevin Warsh's anti-inflation instincts, noting that investors await Warsh's speech for a clear plan. Regarding India, Rajan commented that the India — Indian rupee has held up better than feared, trading around 95.50 per dollar, and dismissed concerns of a panic situation. RBI Governor Sanjay Malhotra separately indicated expectations of at least $80 billion in foreign-currency inflows from recent RBI measures.