Sensex gives a thumbs up, dollar down 50p in a day

The RBI8217;s decision to keep all key rates unchanged today sparked a strong 208-point rally on the Bombay Stock Exchange BSE, with the benchmark 30-share Sensitive Index Sensex ending past the psychologically important 14,000 mark for the first time since February 22. And, in an unprecedented jump, the rupee climbed by 50 paise to a more than nine-year high of 41.1750/ 1850 against the dollar.

There was across-the-board buying support after the central bank kept the cash reserve ratio CRR, short-term lending and borrowing repo and reverse repo rates and bank rates unchanged in its anxiously-awaited policy statement. The Sensex surged to an intra-day high of 14,197.32 before ending at 14,136.72, a net rise of 208.39 points 1.5 per cent over Monday8217;s close of 13,928.33.

At the Inter-Bank Foreign Exchange forex market, the local currency fluctuated in a wide range of 41.70 and 41.05 in extremely volatile trade, after resuming stronger at 41.60/ 62 to the dollar. Heavy dollar sales by traders after the policy announcement boosted the rupee sentiment, forex dealers said.