New Delhi (Uttam Hindu News): BSE Sensex fell by over 600 points after the credit policy announcement by RBI. The biggest decline occurred in bank shares. By 11:30 AM, the Sensex was trading at 71,531.35 points with a huge fall of 648.25 points or 0.90 per cent.
There is a decline of more than 2 percent in Axis Bank, ICICI Bank, Nestle. There is a decline of 1.5 percent in the private bank index. AU Bank is down 2 per cent, Kotak Mahindra Bank is also down 2 per cent. FMCG shares are down 1.2 percent. Tata Consumer is down 2 per cent, Britannia is down 2 per cent and Jyoti Labs is down 3 per cent.
Suman Chaudhary, Chief Economist and Head – Research, Acuity Ratings & Research said it is no surprise that the RBI MPC has decided to maintain status quo on interest rates for the sixth consecutive time. However, the RBI continued to take an hawkish stance contrary to market expectations and has not given any indication about the timing of the change in monetary stance.
Chaudhary said that given the tone of the MPC’s statement and expectations of a growth rebound, we believe the chances of any rate cut by the RBI in the next six months are significantly reduced. Choudhary said, “In our opinion, rates will remain high in the near term. “We also expect bank deposit rates to rise by 25-50 bps given the ongoing gap between credit and deposit growth.”