Rate cut hope pushes Sensex closer to 20K

The Reserve Bank of India (RBI) is expected to cut lending rates in its review meeting on Friday, even though the central bank, in its pre-policy economic review on Thursday cautioned that improved governance was critical for economic recovery and growth.

The Reserve Bank of India (RBI) is expected to cut lending rates in its review meeting on Friday, even though the central bank, in its pre-policy economic review on Thursday cautioned that improved governance was critical for economic recovery and growth.

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Hopes of an interest rate cut, which would make loans cheaper, boosted stock markets with the BSE Sensex jumping 232 points, or 1.2%, to close at a three-month high of 19,736 amid anticipation that the benchmark index could breach the 20,000 mark on Friday.

The NSE 50-share Nifty breached 6,000-level before closing at 5,999.35, a gain of 69.15 points, or 1.17%.