FX.co ★ Sensex Rebounds as RBI Holds Rates, Raises GDP Outlook

On Wednesday morning, India's equity markets experienced a rise of 413 points, equivalent to a 0.5% increase, bringing the index to 80,680. This upward movement marked the end of an eight-session decline, following the Reserve Bank of India's (RBI) decision to maintain the policy repo rate and update its GDP and inflation forecasts. The central bank held the interest rate steady at 5.5%, raised its GDP growth projection for the fiscal year 2025/26 to 6.8% from a previous estimate of 6.5%, and adjusted the inflation outlook downwards to 2.6% from 3.1%. These changes reflect greater-than-anticipated economic strength and easing price pressures. The BSE Sensex also mirrored the gains seen overnight on Wall Street, with investors showing resilience despite concerns over a potential U.S. government shutdown. Meanwhile, the Nifty 50 advanced by 0.4%, surpassing the 24,700 mark, with small-cap and mid-cap stocks increasing by 0.3% and 0.2%, respectively. The pharmaceuticals, banking, and financial services sectors were at the forefront of these gains, buoyed by strong performances from Tata Motors (+2.8%), Kotak Mahindra Bank (+2.2%), Sun Pharmaceuticals (+1.8%), ICICI Bank (+1.7%), and Axis Bank (+1.4%).