Sensex gains on rate cut hopes; core inflation falls

Reuters Market Eye - The BSE Sensex and Nifty are up more than 1 percent, as February core inflation at 3.8 percent gives enough headroom for rate cut by the RBI in its policy review on March 19, dealers say.

India's core wholesale price inflation was estimated at 3.8 percent in February from a year earlier, according to a Reuters snap survey of three analysts and traders on Thursday, below expectations of an around 4.2 percent rise.

The government data released on Thursday gives the Reserve Bank of India room to ease monetary policy when it meets next week, the prime minister's economic adviser, C. Rangarajan, said on CNBC-TV18 television news channel.

Rate-sensitive stocks such as State Bank of India jump more than 3 percent while ICICI Bank rises over 2.5 percent. The BSE banking index is up 2.3 percent at 2:18 p.m.

(Reporting by Abhishek Vishnoi)