New Delhi, Nov. 11 -- India's natural rate of interest is likely to remain stable despite rising interest rates in developed economies, but a narrowing yield gap with the United States could make foreign capital inflows less dependable for financing the country's current account deficit, according to a study by SBI Capital Markets Limited (SBICAPS).

The report said India's stable growth outlook and anchored inflation expectations were supporting its natural interest rate, while gradual fiscal consolidation, an improving credit profile and a recovery in household savings could provide further stability, ANI reported.

The natural rate of interest, or r*, is the theoretical rate at which an economy can grow at its potential without generat...