RBI Policy review update

Equity market snaps the recent rally after the announcement of hike in Repo rate by 25 basis points to a two year high of 6.50% by the RBI. Both the indices were highly volatile during the time of the announcement of Monetary Policy and lastly after the RBI press meet the Indices were closed as days low.

RBI Policy

It pegged retail inflation at 4.8% for the second half of the current fiscal. It also kept GDP forecast unchanged at 7.4% and saw it at 7.5-7.6 in the second half of the current fiscal.

RBI Policy review and rate hike have impacted the sectors like Real estate, Banking, and Auto as the cost of products will be increased due to the interest rate. Weakness is seen more on Bank nifty than in Nifty stocks. Both Private, as well as PSU banks, were closed on a weak note. More correction can be seen in the Bank Nifty this week.