Don’t miss the latest developments in business and finance.

Infra, auto shares gain as RBI keeps repo rate unchanged

L&T, IRB Infra, DLF, DB Realty, Eicher Motors, Hero MotoCorp and Bajaj Auto are up 2-4% on the National Stock Exchange.

Image
SI Reporter Mumbai
Last Updated : Dec 18 2013 | 12:02 PM IST
Shares of interest rate sensitive sectors such as real estate, infrastructure and automobiles have moved higher after the Reserve Bank of India (RBI) kept the key rates unchanged.

The repurchase, or repo, rate, at which RBI lends overnight funds to banks, is currently pegged at 7.5%. CRR, which defines the amount of money banks need to park with the central bank for no interest, is at 4%.

Larsen and Toubro, IRB Infrastructure, BHEL and Crompton Greaves from infrastructure, DB Realty, HDIL, DLF and Indiabulls Real Estate from realty and Eicher Motors, Hero MotoCorp, Bajaj Auto and Ashok Leyland from automobiles are up 2-4% on the National Stock Exchange.

The central bank said its focus has now shifted towards supporting growth even as risks to inflation remain high.

Current inflation is too high. However, given the wide bands of uncertainty surrounding the short term path of inflation from its high current levels, and given the weak state of the economy, the inadvisability of overly reactive policy action, as well as the long lags with which monetary policy works, there is merit in waiting for more data to reduce uncertainty, says RBI in a statement.
 

More From This Section

First Published: Dec 18 2013 | 12:00 PM IST

Next Story