Technology stocks such as LTIMindtree and Wipro faced significant losses on 19th December following a more hawkish stance from the US Federal Reserve than anticipated.

The domestic IT sector faces challenges as higher US interest rates spike bond yields, strengthen the dollar, and raise IT service costs for US clients, potentially reducing demand.

A tighter US monetary policy could slow economic growth, limiting discretionary IT spending by businesses and dampening sentiment for Indian IT services.

President-elect Donald Trump’s office in January 2025 might bring new tariffs, potentially causing sharp inflation surges and altering the Federal Reserve’s monetary policy.

The Federal Reserve has raised its 2025 inflation forecast to 2.5%, adding pressure to the IT sector despite its recent gains, with the Nifty IT index rising 8% in the past month and 30% over six months.

At 11:19 AM, LTIMindtree was down by 4.36% at Rs 6,287.10, Wipro was down 0.64% at Rs 310.60, TCS was down 0.81% at Rs 4,312.45 and Infosys was down 2.07% at Rs 1,938.10.

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