The markets on Tuesday are trading lower as they focus sed the Reserve Bank of India’s (RBI) second monetary policy review of 2018-19. The policy decision is due on Wednesday, June 6.
An increasing number of economists expect the Reserve Bank of India (RBI) to raise interest rates on Wednesday, a Reuters poll found, but most still think the central bank will stay on hold and use this week’s meeting to prepare for an August hike.
In a snap poll of 56 economists taken after gross domestic product data on Thursday, 26 of those respondents, or about 46 percent, expect the RBI to take the repo rate higher at the June 6 meeting.
Among macro data, activity in India’s service industry shrank in May for the first time in three months as new orders stagnated, but business optimism was the highest since 2015 on expectations that demand will turn around, a business survey showed.
The Nikkei/IHS Markit Services Purchasing Managers’ Index fell to 49.6 in May from April’s 51.4, sinking below the 50-mark that separates growth from contraction.
Globally, Asian stocks dipped on Tuesday as the markets took a breather after the previous day’s rally, although tech-inspired Wall Street gains helped limit the losses, with investor focus moving away from trade concerns and back to benign economic fundamentals.
MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.1 per cent after surging 1.4 per cent the previous day.
Japan’s Nikkei gained 0.2 per cent and South Korea’s KOSPI lost 0.3 per cent.