Share market gains: How RBI's policy decision is driving Sensex, Nifty
India Today
The NSE Nifty 50 index rose 0.86 per cent to 17,613, while the S&P BSE Sensex was up 0.87 per cent at 58,976, according to data on BSE India and NSE India websites.
The Sensex and Nifty rose on Thursday, after the Reserve Bank of India (RBI) held its key lending rate steady as expected but left the deposit rate unchanged in a surprise move, and said continued policy support was warranted given the inflation outlook and global headwinds.
The RBI's monetary policy committee (MPC) held the lending rate, or the repo rate, at 4 per cent and the reverse repo rate, or the key borrowing rate, at 3.35 per cent. Some economists had predicted a hike in the reverse repo rate to re-align it with short-term money market rates.
SHARE MARKET GAINS
The NSE Nifty 50 index rose 0.86 per cent to 17,613, while the S&P BSE Sensex was up 0.87 per cent at 58,976, according to data on BSE India and NSE India websites.
"It seems the RBI gauged that markets need to be assuaged over material tightening of financial conditions ahead as global dynamics change, and decided to stay put," said Madhavi Arora, lead economist, Emkay Global Financial Services, Reuters reported.
India's 10-year benchmark bond yield fell 4 basis points to 6.7610 after the policy decision, while the rupee weakened against the dollar to 75.0275.
Both the Nifty and Sensex have seen sell-offs this year after rising more than 20 per cent in 2021, as central banks across the globe gear up to tackle high inflation and foreign investors exit emerging markets amid expectations for higher interest rates.
