Indian shares opened higher on Tuesday, as data showing consumer inflation eased for a third straight month raised hopes that the RBI may rein in the pace of its rate hikes next month.
The NSE Nifty 50 index was up 0.5 per cent at 17,785.4, while the S&P BSE Sensex was 0.6 per cent higher at 59,817.2. The Sensex and Nifty were closed on Monday for a holiday.
The consumer inflation dipped to 6.71 per cent in July, aided by a slower increase in food and fuel prices. The figure was marginally lower than the 6.78 per cent forecast by economists in a Reuters poll.
July retail inflation eases to 5-month lowAt 6.7%, still far from RBI’s target; industrial growth dips to 12.3% in June
Banking and auto stocks gained, with the Nifty Auto index up 1.1 per cent.
Shares of Life Insurance Corporation of India rose 2.5 per cent after it had posted a 20 per cent jump in June-quarter premium income on Friday.
Asian stock markets struggled for direction, weighed down by worries over global growth following weak China data that knocked oil prices and commodity-linked currencies.
India's currency and debt markets remained closed on Tuesday for a holiday.