The Nifty 50 was up 0.30% at 17,610.20 as of 11:01 a.m. IST, while the S&P BSE Sensex rose 0.32% to 59,882.93. Both benchmarks had fallen 0.3% ahead of the RBI's rate decision.
The 10-year benchmark 7.26% 2032 bond yield was at 7.1987% as of 10:35 am IST, after closing at 7.2750% Wednesday. The yield fell to 7.1469% after the decision, against 7.2857% before that.
RBI said it stood ready to act against inflation if conditions warranted, with Governor Shaktikanta Das saying the decision to pause was 'for this meeting only', signalling further rate hikes were still possible.
While saying that higher interest rates affect growth more than inflation, the two members said raising rates further could result in 'unacceptably low' growth in 2023-24.
Although RBI has been raising repo rate to contain rising inflation & lending, it hasn't discouraged borrowers. The growth in credit could partly be attributed to ‘pent up demand’.
RBI Governor Shaktikanta Das says recent surge in infections has lent greater uncertainty to growth outlook, and warns regional lockdowns could dampen recent improvement in demand.
The collusion between the new class of bureaucrats, politicians, businessmen and trade union bosses perpetuates itself partly because of the short-run benefits and partly because they see no way out of the system, wrote author MH Mody in 1980.
IAF is firming up plans to revamp airlift capabilities with medium transport aircraft that will be assembled in India & serve as its main workhorse. Embraer is leading contender as of now.
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