Market Update: RBI Keeps Repo Rate Steady, Forex Reserves Hit Record High, and Key Economic Developments

Market Summary

The benchmark Nifty index fell by 0.74% to close at 24117.0 on 08-Aug. The Nifty Midcap150 index fell by 0.35% to close at 20991.0. The Nifty Smallcap250 index fell by 0.28% to close at 17226.2. The 10yr yield rose by 1 bps to close at 6.92%. The rupee remained unchanged at 83.9515 against the US Dollar.

Key News

* In its 50th review of monetary policy, the RBI’s 6-member MPC on Thursday decided to keep the repo rate unchanged at 6.5%, reports BS
* The RBI on Thursday retained the growth projection at 7.2% for the current fiscal amid expectations of a normal monsoon, reports FE
* Households expect inflation to rise in the next 3 months to 1 year driven mainly by food prices, housing and cost of services, according to a survey by the RBI, reports
FE
* Centre to treat capex loans to states as grants. Rs 3.7 trillion transferred to states during FY21-FY25 under the mechanism, reports FE
* Rs 1.82 trillion GST from mobile phones 5 times what PLI allocated, reports BS
* The Central Board of Direct Taxes, driven by a “very steep rise” in pending income tax arrears, has decided to create a special team to identify the “top 5,000 cases” by the end of September, reports BS
* India’s forex reserves touched an all-time high of $675 billion as of August 2, reflecting a robust external sector performance, RBI Governor Shaktikanta Das said during announcement of MPC decision, reports ET
* The RBI-led MPC proposed several measures to speed up clearance of cheques to a few hours, said governor Shaktikanta Das, reports ET