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Sensex to reclaim 60,200 level by over 500 points after RBI policy result

Mumbai: Equity benchmark Sensex climbed over 500 points in morning trade on Friday after the Reserve Bank kept key interest rates unchanged in its bi-monthly monetary policy review.

After reclaiming the 60,200 level, the 30-share Sensex was trading 524 points or 0.88 per cent higher at 60,201.83. Similarly, the Nifty rose 149.45 points or 0.84 per cent to 17,939.80.

Infosys, TCS, Reliance Industries, HCL Tech and Bajaj Auto were the top laggards in the Sensex pack, rising over 2 per cent.

On the other hand, HUL, NTPC, Titan and Nestle India were trailing.

Rate-sensitive banking and auto indices were trading on a positive note, while the realty index was in the red.

The Reserve Bank of India (RBI) has decided to keep the benchmark interest rate unchanged at 4 per cent but maintains a lenient stance while the economy is showing signs of recovery after the second COVID wave.

This is the eighth time in a row that the Monetary Policy Committee (MPC) headed by RBI Governor Shaktikanta Das has maintained the status quo.

Suvodeep Rakshit, senior economist at Kotak Institutional Equities, said the RBI’s policy, as expected, remained cautious and in a wait-and-watch mode.

“Even as it increased the volume under 14-day Variable Rate Reverse Repo (VRRR) auctions and opened the option of 28-day VRRR auctions, it adequately took note of the need to ensure its sluggishness and liquidity position,? noted.

He does not see the RBI in any hurry to normalize the liquidity position as well as the reverse repo rate in the near term. “We continue to view the February policy as an early period of review for the RBI to ease the policy rate corridor by raising the reverse repo rate.”

By Naveen Bharat Staff

 

 

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