New Delhi: The reserve bank of India has cut down the repo rate, the rate at which the reserve bank lends to commercial banks in the market. The step was welcomed by stock market with Sensex and Nifty climbing up in points. The Sensex climbed over 600 points and came closer to 28,000 mark while Nifty climbed 176.05 points to reach 8,453.60.
According to economic circles, the surprise step was taken of the sharp fall in global crude prices and expectations that the Government would be able to keep the fiscal deficit in check.
The global crude prices have fallen by almost half in the previous year now at a rate of around $50 per barrel.
In India the domestic inflation is also in comfortable state with its rise being slow and tolerable. The wholesale price Index stood at 0.11% in December. In a statement by the RBI it was said that these developments were responsible for the shift in monetary policy stance.