Impact of Inflation, Interest Rates, and Exchange Rates on Returns of the BSE Index.

Inflation, currency rates, and interest rates are the three macroeconomic factors examined in this study on the returns of the BSE index for the years 2023-2025. A quantitative research design was used to gather secondary data from the Bombay Stock Exchange’s (BSE) and Reserve Bank of India’s (RBI) official websites. The BSE index return was the dependent variable. While inflation, the Interest Rate of Indian banks, and the INR/USD exchange rate were the independent variables. Research data met all the regression assumptions, as indicated by the results. The F-test showed that the combined effects of interest rates, inflation, and currency rates on the returns of the BSE index were not statistically significant. None of the individual factors had a significant partial impact on market returns over the study period, according to the t-test findings. These results suggest that other variables, such as company performance, investor sentiment, and global market trends, may have a greater influence on short-term fluctuations in the BSE index than the selected macroeconomic indicators.