A downturn in core inflation or wage growth in US could force the Federal Reserve to delay the increase to borrowing costs, US Fed Chair Janet Yellen said on Friday.

IMF Chief Christine Lagarde said: \"The world has yet to achieve full economic recovery as global growth continues to be weighed down by high debt, high unemployment and lacklustre investment\".

According to the RBI data, foreign currency assets, the biggest component of the forex reserves declined by $1.97 billion at $310.34 billion in the week under review.

Gold price was headed for its biggest weekly jump since January, after the US Federal Reserve cautioned over its rate hike path and US economic growth.

India has built up record foreign exchange reserves of nearly $340 billion to insulate the economy from capital flight as the United States prepares to lift interest rates.

There is a good chance of US equities witnessing strong buying after trading with a slight downtrend over the past month. If the US rally is sustained over the next few weeks, the Indian equity market will touch an all time high.

\"India is much better prepared if Fed moves on rates\", he said. Rajan further said that RBI will take a cue from the Fed policy statement.

Forex brokers said persistent selling of dollars by banks and exporters due to weakness of the Greenback in the overseas market also helped the rupee.

Shares of Axis Bank, SBI, ICICI Bank, BHEL, RIL and ITC saw moderate to sharp losses, leading to the index's fall for the second straight session.

The Fed's announcement moved the central bank to the verge of ending a period of more than six years in which it has held short-term interest rates near zero.

Marc Faber, publisher of The Gloom, Boom & Doom report speaks to BT's Mahesh Nayak on India's potential, the state of the global economy, and a range of other issues.

The IMF Chief Christine Lagarde praised RBI Governor Raghuram Rajan's deft handling of the crisis spillover in India in 2013.

With global rating agencies approving the reforms agenda of the government, the rupee will most likely outperform its peers when the Fed eventually hikes rates.

A near majority of Fed officials publicly have endorsed the idea of removing the patience pledge, putting investors and the public on notice that a rate hike could occur at any point from June onward.

Overall trading sentiment was weak as the US Federal Reserve is expected to lay the groundwork for its first interest rate hike in nearly a decade.

The IMF chief praised RBI Governor Raghuram Rajan for his correct prediction of the 2008 economic crisis saying IMF committed a big mistake by not listening to his forecast.

In a speech in Mumbai, Managing Director Christine Lagarde warned the so-called \"taper tantrum\" that slammed emerging markets in 2013 could be repeated.

Sentiment was buoyed by data that showed foreign direct investment (FDI) in India more than doubled to $4.48 billion in January, the highest inflow in last 29 months.

RBI Governor Raghuram Rajan must hit the interest rate easing button faster than most expect to spur economic growth.

The statement by International Monetary Fund chief Christine Lagarde came just ahead of a US Federal Reserve meeting, in which it may signal an increase in interest rate.