Financial Markets To Remain Closed On Wednesday

Domestic financial markets remained closed on Wednesday, June 5, for Eid Ul Fitr 2019. The stock, bond and forex markets will resume trading on Thursday, a day on which the central bank is scheduled to announce its statement after conclusion of a three-day bi-monthly policy meeting. The S&P BSE Sensex and NSE Nifty equity indexes had ended 0.46 per cent and 0.55 per cent on Tuesday, whereas the rupee finished flat at 69.26 against the US dollar (INR vs USD).

The 10-year benchmark bond yield ended at 7.02 per cent on Tuesday, as against the previous close of 7.03 per cent.

The Reserve Bank of India (RBI) will release its bi-monthly policy statement on Thursday, June 6, after the conclusion of a three day meeting of its Monetary Policy Committee. This would be the second bi-monthly policy statement on financial year 2019-20.

In its past two policy reviews, the RBI governor-led Monetary Policy Committee reduced the repo rate by 25 basis points each. Repo rate - the key interest rate at which the RBI lends short-term funds to commercial banks - currently stands at 6 per cent.

In its June 6 statement, the RBI is widely expected to reduce the repo rate by 25 basis points to 5.75 per cent.

Two-thirds of 66 economists polled by news agency Reuters expect the MPC to cut the repo rate by 25 basis points, in a survey taken before the government released far worse than expected economic growth data. Since then, the expectation for a rate cut has probably hardened.

The 30-scrip benchmark Sensex index has gained 1,398.82 points, or 3.62 per cent, since the April 4 policy review.