The US 10-year yield rose to 3.11 before tapering a tad ahead of the Fed interest rate decision on Wednesday. The market is expecting a 25 basis point hike (bps).

One basis point is a hundredth of a percentage point.

Paul Kitney, chief equity strategist of Daiwa Capital Markets, expects the Federal Reserve to focus on the currency more as it has been affecting the emerging markets negatively. “The damage has been done to emerging markets (EMs) and it has largely been driven by currency broadly based strong US dollar,” said Kitney.

With regards to India's economy, he said, “As far as India is concerned, it has got very solid earnings growth, we are looking at 14-15 percent earnings growth this year. As far as higher oil prices particularly in rupee terms are concerned, this is not translating into inflation, so we saw the most recent inflation data being less than 4 percent."