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Banking shares were trading higher by up to 4%, extending their Monday’s gain, in otherwise subdued market after the Wholesale Price Index (WPI)-based inflation declined to its lowest level in five years at 2.38% in September from 3.74% in the previous month.
The government data released on Monday also showed that the overall food inflation measured on the Consumer Price Index (CPI) fell to 7.67% as against 9.35% in the previous month and 11.75% in September 2013. CPI inflation is on the decline since July.
State Bank of India, Axis Bank, Federal Bank, Indusind Bank, Oriental Bank of Commerce, Andhra Bank, Bank of India, Union Bank of India, Allahabad Bank and Syndicate Bank were up 2-4% on the National Stock Exchange (NSE).
Bank Nifty, the banking share index, the largest gainer among sectoral indices, was up nearly 1% compared to 0.22% decline in benchmark CNX Nifty.
At 1400 hours, CNX PSU Bank, the state-owned banking share index, surged almost 2%, extending its previous 2% gain on NSE.
Over the next 2 months, headline CPI inflation could ease further due to a base effect from last fiscal, lower crude oil prices, revival of monsoon and proactive measure by the government keeping food prices under control, and a stable currency, according to CRISIL Research.
Bank of America Merrill Lynch in recent report said, the Reserve Bank of India (RBI) is likely to cut rates beginning February as inflation is expected to reach the targetted 8% by next January.
RBI Governor Raghuram Rajan is expected to cut 75 basis points in 2015, beginning February, according to the global financial services major, a PTI report suggests.
The government data released on Monday also showed that the overall food inflation measured on the Consumer Price Index (CPI) fell to 7.67% as against 9.35% in the previous month and 11.75% in September 2013. CPI inflation is on the decline since July.
State Bank of India, Axis Bank, Federal Bank, Indusind Bank, Oriental Bank of Commerce, Andhra Bank, Bank of India, Union Bank of India, Allahabad Bank and Syndicate Bank were up 2-4% on the National Stock Exchange (NSE).
Bank Nifty, the banking share index, the largest gainer among sectoral indices, was up nearly 1% compared to 0.22% decline in benchmark CNX Nifty.
At 1400 hours, CNX PSU Bank, the state-owned banking share index, surged almost 2%, extending its previous 2% gain on NSE.
Over the next 2 months, headline CPI inflation could ease further due to a base effect from last fiscal, lower crude oil prices, revival of monsoon and proactive measure by the government keeping food prices under control, and a stable currency, according to CRISIL Research.
Bank of America Merrill Lynch in recent report said, the Reserve Bank of India (RBI) is likely to cut rates beginning February as inflation is expected to reach the targetted 8% by next January.
RBI Governor Raghuram Rajan is expected to cut 75 basis points in 2015, beginning February, according to the global financial services major, a PTI report suggests.
