Muristek
New Delhi, April 7
There has been volatility in the stock market and the benchmark indices — Sensex and Nifty — ended in the red on the eve of RBI's announcement about its monetary policy in the face of raging inflation.
While price rise has led to several experts seeking an increase in lending rates to curb inflation, the RBI will also be mindful of the fact that any such hike in lending rates will also burden the Central government and states with an added burden on its debt.
Sensex settled at 59,034.95 points, down 575.46 points while Nifty closed the day at 17,639.55 points, down 168.10 points.
The deliberation of the RBI's ongoing Monetary Policy Committee (MPC) meeting will be announced on Friday by the RBI Governor Shaktikanta Das.
"Growth recovery is still uneven and inflationary expectations have risen, hence we expect the RBI to maintain 'accommodative' stance as long as necessary. However, with the cumulative rise in price of fuel, it would be important to watch if the RBI revises the inflation forecast higher," said Umesh Revankar of Shriram Transport Finance.