Indian stocks barely budged after the government released April factory output data Friday. Analysts say that's because investors are waiting to see what happens at the Reserve Bank of India's next rate-setting meeting, which is just around the corner.
- Punit Paranjpe/Agence France-Presse/Getty Images
- Investors are waiting to see what happens at the RBI's next rate-setting meeting, which is just around the corner.
The central bank's mid-quarter monetary policy review is scheduled for Thursday and investors will be closely watching if the RBI sticks to a hawkish policy stance, said Dilip Bhatt, joint managing director at brokerage Prabhudas Lilladher.
India’s industrial output in April grew 6.3% from a year earlier, according to a new index released by the government Friday. As per the old index, factory output growth was 4.4%, lower than the 5.0% estimated in a poll of 13 economists.
The 30-share benchmark index slipped into negative territory at the start of trade and it was little changed after the data release. In afternoon trade, the index was down 0.9%, tracking a weak opening in the European markets.
Analysts say another reason for the muted impact on stocks is that investors are still trying to get their heads around the new index, which has different weights for components than the previous index.
But the RBI's next meeting is the dominating factor. The central bank has increased key lending rates nine times since March 2010 to combat stubbornly high i [...]
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