Indian benchmark indices closed higher after the Reserve Bank of India maintained status quo on policy rates. Bank Nifty touched its fresh 52-week high after RBI’s neutral stance.
Indian benchmark indices closed higher after the Reserve Bank of India maintained status quo on policy rates. Indian Meteorological Department’s revised forecast on monsoon and strengthening rupee also boosted investor sentiment.
BSE Sensex closed 80.72 points or 0.26% higher at 31,271.28, while NSE Nifty, the broader gauge, ended the session 26.75 points or 0.20% higher at 9,663.90 points.
Bank Nifty touched its fresh 52-week high of 23606 level higher by 190 points after RBI’s neutral stance. Bank stocks like Federal Bank, PNB, ICICI Bank and Bank of Baroda gained in the closing hour. Indian Rupee closed 10 paise higher at 64.33 against the US Dollar.
The S&P BSE Midcap index gained 68 points or 0.58% to close at 14,800 points while the S&P BSE Smallcap Index rose 115 points or 0.75% to end the session at 15,425 points. India VIX closed lower by 2.17% at 10.89 level.
The central bank left the repo rate unchanged citing risks to inflation due to spurt in farm loan waivers by states. RBI Governor Urjit Patel-led Monetary Policy C for the fourth straight time kept the repo rate unchanged at 6.25 per cent. The reverse repo has been maintained at 6 per cent. The central bank left the cash reserve ratio static at 4 per cent. RBI’s decision to keep key interest rate unchanged was largely in line with market expectations. However, the central bank reduced the Statutory Liquidity Ratio (SLR) by 50 basis points to 20 per cent, a move that will allow banks to give more loans.
You may also like to watch:
RBI also cut growth projection for the current fiscal by 10 basis points to 7.3 per cent from 7.4 per cent and projected inflation in 2.0-3.5 per cent range for the first half of 2017-18 and 3.5-4.5 per cent for the second half. The central bank said that the implementation of the GST from 1 July is not expected to have a material impact on overall inflation.