In the middle of 2013, concerns emerged on the US Federal Reserve tapering, with international markets fearing that the Fed would start pruning its monthly bond purchase of $85 billion, which had found its way to emerging markets. This led to a free fall in the currencies of markets that had high current account deficits, including India. The Reserve Bank of India (RBI) countered this by sucking out liquidity, leading to an increase in short-term interest rates for a few months. The markets corrected sharply and banking stocks plummeted as they were perceived to be impacted by higher borrowing costs.