Sensex dips on RBI concerns
Jan. 25: The RBI’s concerns over inflation and current account deficit pulled down the Sensex on Tuesday by about 182 points to below the 19,000-mark, at at 18,969.45. The Nifty also dropped by 55.85 points to 5,687.40.
The market had initially absorbed the hike of repo and reverse repo. But the central bank’s concerns over the spillover of food inflation to general inflation, rising global crude oil prices and high current account deficit weighted down the market. The sectors that the most are banking, realty, auto and FMCG.
The Sensex fall was also on account of retail investors and funds squaring up their pending positions before the end of January settlement in the derivatives segment. Meanwhile, in the policy review, the cash reserve ratio and statutory liquidity ratio (SLR), however, have been left unchanged at six per cent and 24 per cent, respectively.
Experts said some investors were expecting a 50 basis point hike in key rates and in view of high inflation. There might be an overall hike in rates by 100 basis points during 2011, they added.
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