New Delhi, March 7 || The ongoing conflict in the Gulf -- involving Israel, Iran, and US assets in the region -- could have far-reaching economic consequences, including global recessionary pressures, rising inflation and financial market turbulence, a report by SBI Research said on Saturday.
However, domestic financial markets have been supported by RBI interventions such as smoothing of G-sec yields and management of rupee volatility.
It, however, warned that prolonged conflict could still pressure India’s macroeconomic indicators.
"Much to the chagrin of select opinion makers, RBI’s intervention in the spot market, curbing the excess volatility, while bringing the rupee to below the 92 level marks a bold move given the lingering uncertainty on the exchange front," according to the report.
The closure of the Strait of Hormuz, through which nearly 20 per cent of the world’s crude oil passes, has already pushed Brent crude prices higher.