The BSE benchmark Sensex, which rose to 27,082.63, ended up 232.22 points or 0.87% at 27,009.67 on Tuesday. The Nifty50 of the National Stock Exchange closed at 8,266, up 65.40 points or 0.8%, after rising to a high of 8,294.95 intraday.
In the forex market, the rupee was trading at 66.75 against the US dollar around mid-afternoon, up from its previous close of 66.98 a dollar.
The RBI's announcements were mostly in line with experts' predictions. The central bank pegged India's growth forecast at 7.6% for the current fiscal and kept the inflation target unchanged at 5% with an upward bias for January 2017.
Apart from the monetary policy review, the monsoon forecast by India Meteorological Department is also said to have a positive impact on the market. The Met predicted that southwest monsoon is "very likely" to hit Kerala on June 9.

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