RBI Monetary Policy: Investors beat Sensex, Nifty, as RBI hikes repo rate by 25 bps
The moment RBI announced August policy, Sensex and Nifty 50 gave away nearly 140 and over 35 points.
The RBI (Reserve Bank of India) monetary policy review meet outcome has been announced today. Once again RBI governor Urjit Patel decided to shake the markets with a surprise, which involved another hike in policy repo rate by 25 basis points. Now India’s policy repo rate stands at 6.50% compared to previous 6.25%, whereas reverse repo rate comes at 6.25% from previous 6%. Looks like this was not what investors had in mind, as they indulged in heavy selling in both benchmark indices.
The moment RBI announced August policy, Sensex and Nifty 50 gave away nearly 140 and over 35 points. Currently Sensex is trading at 37,498.20 down by 85.81 points or 0.23%, while the Nifty is below 23.45 points or 0.21% trading at 11,333.05.
Among top losers on BSE were - Vedanta at Rs 217.40 per piece down by 2.18%, followed by Maruti Suzuki at Rs 9349 per piece below 1.66%, Tata Steel at Rs 554 per piece lower by 1.57%, ICICI Bank at Rs 299.30 per piece down by 1.53% and Bharti Airtel at Rs 384.75 per piece down by 1.52%.
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Other companies that tumbled were - Axis Bank (1.47%), SBI (1.11%), Adani Ports (0.90%), Yes Bank (0.84%) and Asian Paint (0.79%).
The other gainers were - Coal India taking lead at Rs 270 per piece higher by 3.17%, followed by TCS at Rs 1978 per piece up by 1.79%, Sun Pharma at Rs 574.50 per piece above 1.39%, ONGC at Rs 167 per piece above 0.91% and Power Grid at Rs 183.70 per piece up 0.82%.
Five out of six MPC members opted for a rate hike in policy repo rate today. The decision of the MPC is consistent with the neutral stance of monetary policy in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth.
RBI governor Urjit Patel says, “Fiscal slippage could cause inflationary pressures.” However, he stated that, capacity utilisation remains robust.
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