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How did the market anticipate that Raghuram Rajan’s would not be too hawkish?

Why did the market shoot up minutes before the RBI’s governor’s speech? Did someone know what that there would be no nasty surprises?

Today, a very peculiar phenomenon was observed in the markets. It was noticed that the markets had already made its move ahead of Raghuram Rajan’s decision to increase repo rate. Just minutes before the announcement, the markets fell down and then immediately shot up. Volatility was immense. Did the markets anticipate that the Reserve Bank governor Raghuram Rajan would do what was widely expected and not spring a nasty surprise like last time?
 

The market was trending down since morning, continuing the decline witnessed yesterday till 10.45 when the Nifty was trading at 6,085. A few minutes later, at 1052 hours Nifty markets inched up to 6,090. However, within the next few seconds, the market shot up to 6,124, or 34 points – well before Raguram Rajan spoke. Subsequently, when he announced the widely expected policy of raising repo rates, Nifty fell all the way to 6,079 within a matter of a few seconds in a knee-jerk reaction. Mr Rajan announced a 25 basis percentage points increase in repo rate, from 7.50% to 7.75% and kept cash reserve ratio (CRR) intact. Since this exactly what was expected and there was no nasty surprise, the buyers stepped in and pushed the market much higher. The intraday volatility was immense. However, the fact is that even before the RBI governor appeared, the upwards market direction was suddenly well-set without absolutely no new information present.
 


The screen grab from Google Finance above will illustrate the point:
 

In fact, the markets had tanked yesterday when there were rumours of an even more hawkish stance from the RBI governor, while rest of Asia and the world was trending up. Bulls were emboldened today that the hawkish stance did not come to pass. But even before Raghuram Rajan spoke?

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