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Banks extend gains on hopes of rate cut on May 3

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Reuters

Reuters Market Eye - Shares of Indian banks extend gains after data showed wholesale inflation slowed in March, raising hopes the central bank would cut interest rates at its policy review on May 3.

Rate cuts help loan growth at lenders and ease margin pressures, according to analysts.

Public sector banks could also benefit as they are big holders of government bonds, which could rally should the RBI ease monetary policy.

State Bank of India gains 3.3 percent and ICICI Bank Ltd is up 1.7 percent.

(Reporting by Abhishek Vishnoi)

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First Published: Apr 15 2013 | 2:11 PM IST

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