The Nifty Bank index surged over 1% to touch an all-time high of 56,506.15 after the Reserve Bank of India (RBI) surprised markets by slashing the repo rate by 50 basis points to 5.50%. This was double the 25 bps cut expected by analysts, including a report from Nuvama, which had forecast a more gradual easing cycle.
All 12 Nifty Bank constituents were in the green. Top gainers included IDFC First Bank, Bank of Baroda, Axis Bank, PNB, and Kotak Mahindra Bank, each rising over 1%.
The RBI’s decision, driven by soft inflation below 4%, cooling demand, and comfortable liquidity, was seen as a bold move to support economic growth. Bond markets responded swiftly, with the 10-year government bond yield falling over 9 bps to 6.1611%.
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