Indian shares open higher ahead of central bank rate decision

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FILE PHOTO: People pass by the Bombay Stock Exchange (BSE) building in Mumbai, India November 4, 2020. REUTERS/Francis Mascarenhas
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BENGALURU (Businesshala) – Indian stocks rose on Friday ahead of a central bank decision that could leave most interest rates at record lows to support an economy reeling from the pandemic.

At 0346 GMT, the NSE Nifty 50 index was up 0.53% at 17,884.50 and the benchmark S&P BSE Sensex was up 0.49% at 59,969.92.

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Blue-chip Nifty 50 and Sensex have risen nearly 10% since the central bank’s last meeting in August and hit record highs on easing concerns about a third wave due to rapid vaccination.

Traders will probably have to keep an eye on the RBI’s thinking on liquidity withdrawals as surplus cash in the banking system has topped 10 trillion rupees ($134 billion) in recent weeks.

Some analysts have indicated a slim possibility of the Monetary Policy Committee providing an indicative hike in the reverse repo rate, even though it keeps the repo rate unchanged at 4% from May last year.

All 60 forecasters in a Businesshala poll said they do not see any change in the repo rate.

Madhavi Arora, Principal Economist, Global Financial Services, said, “While the RBI may not shock the system with the reverse repo hike, the policy can be used to prepare the market for a gradual approach towards normalization through both communication and action. to be used as a lever for.” A preview note.

Meanwhile, shares of Tata Consultancy Services were up 0.85% from the September quarter results. IT giant Kick has started the earnings season, which is expected to show signs of recovery for Indian companies.

Reporting by Nallur Sethuraman in Bengaluru; Editing by Shreeraj Kalluvilla

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