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Markets cold by hike in inflation target by RBI
Markets cold by hike in inflation target by RBI
RBI cut repo rate by 0.25% from 6.5% to 6.25%, but revised inflation rate target for Mar',2017 & Mar',2018 from 5% & 4% to 5.3% & 4.5% respectively,due to incorporation of 7th pay commission recommendations on house rent allowances(HRA).It also cut interest rates but it signals limited scope for further rate cuts. BSE's sensex closed up by 9% & NSE Nifty up by 0.4%.RBI may reduce rates by 50 basis points in December.
