This was a week when the world's central banks tightened instead of easing, and India felt it. The US Federal Reserve under new chair Kevin Warsh raised rates by 25 basis points to 3.75-4.00%, its first hike since 2023, and the Bank of Japan followed with a hike to 1.25%. Brent crude stayed above $100 a barrel because the war around Iran has shut most traffic through the Strait of Hormuz and Houthi forces now sit on Yemen's Red Sea coast, while a drone attack on Saudi Arabia's East-West pipeline on 10 September is still being repaired. The rupee closed at 95.89 per dollar near record lows, foreign investors kept selling, and the Sensex fell for a sixth straight week, its longest losing run since 2020. On 18 September Donald Trump also signed a law that lets him put tariffs of up to 100% on countries buying Russian oil, naming India and China, which is now the single biggest known risk hanging over Indian exporters.

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Indian equities fell for a sixth straight week, with the Nifty 50 ending at 23,346 and the Sensex at 74,295. The main pressure came from outside India: the US Federal Reserve raised rates for the first time since 2023, Brent crude stayed above $100 a barrel after attacks on Saudi infrastructure, and foreign investors pulled out another ₹7,620 crore. Domestic institutions bought ₹11,232 crore and cushioned the fall, which is why the weekly loss was small despite the bad news. Inflation is now the bigger worry at home, with retail inflation at a 20-month high of 4.82% and wholesale inflation near 10%, which makes an RBI rate cut unlikely for now. A governance fight at Tata Sons also knocked TCS and other Tata stocks lower on Friday.

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