MUMBAI, Nov 12 (Reuters): Indian shares touched record highs for the second time this week as rate-sensitive stocks such as Axis Bank rose on hopes easing inflation would prompt the central bank to cut interest rates earlier than expected.
Consumer inflation in October, due at 5:30 p.m. (1200 GMT), is expected to have eased to a record low of 5.80 per cent, dragged by sharp drops in food and oil prices, according to a Reuters poll. If the forecast is met, it would also make the central bank's inflation targets - 8 per cent by January 2015 and 6 per cent a year later - appear more attainable.
"The market is expecting inflation to come down very fast. So if the rates are not cut then certainly some momentum will be lost," said Vinod Nair, head of fundamental research at Geojit BNP Paribas Financial Services Ltd.
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