Sensex, Nifty rise ahead of RBI Monetary Policy Committee meeting outcome

Stock market news: Benchmark indices S&P BSE Sensex and NSE Nifty 50 opened higher on Thursday, February 8, 2024, as investors braced for the Reserve Bank of India's (RBI) monetary policy decision, widely anticipated to maintain its key interest rate steady for a sixth consecutive meeting.

As of 9:30 am, Sensex was trading 234.07 points higher at 72,386.07 and Nifty was trading 71 points higher at 22,002.40.

The RBI is scheduled to announce its rate decision at 10:00 am.

A Reuters survey conducted among 60 economists earlier this month suggests that the RBI would likely hold its key repo rate unchanged at 6.50 per cent on Thursday, maintaining the status quo until at least July.

Investors are keenly observing whether the recent moderation in core inflation and the government's emphasis on fiscal prudence in the interim budget might prompt policymakers to signal a shift in the rate cycle.

"We anticipate the Monetary Policy Committee (MPC) to unanimously opt for a pause in rate adjustments and pivot the policy guidance from the current tightening bias to a more neutral stance," analysts at Nomura remarked.

Furthermore, market analysts anticipate that the RBI will introduce measures aimed at addressing the existing tight liquidity conditions in the economy.

The halt in rate hikes throughout this fiscal year, following a cumulative increase of 250 basis points in the previous fiscal, has propelled the benchmark Nifty 50 to surge over 25 per cent to fresh highs since March 2023.

(With Reuters inputs.)