The six-member Monetary Policy Committee (MPC), headed by Reserve Bank Governor Urjit Patel, kept the policy rate unchanged at 6 percent on expected lines but raised the inflation forecast for the remainder of the fiscal to 4.3-4.7 percent.
Similarly, the NSE Nifty ended lower by 74.15 points, at 10,044.10.
The 30-share Sensex opened on a negative note on across-the-board losses and touched a low of 32,682.52.
At 10:14 AM, the S&P BSE Sensex was trading at 33,168, up 219 points while the broader Nifty50 index was ruling at 10,237, up 70 points.
PSU Bank Nifty rose 1.25 per cent led by lenders such as Bank of India, Oriental Bank, Syndicate Bank and SBI on expectations that the government would soon reveal details of a recapitalisation plan.
YouTube may launch its own streaming music service in 2018
Talks with Sony and Universal, as well as Merlin-which represents hundreds of independent record labels-are apparently underway. Without major label support, a streaming service can not offer proper content to keep users interested.
In sync with overall trend, the rupee too weakened to quote at 64.55 against the dollar intra-day.
Among the BSE sectoral indices, power fell 1.06%, followed by metal 0.85%, capital goods 0.62%, consumer durables 0.61%, infra 0.56%, auto 0.52% and IT 0.38%.
Top five Sensex gainers were Bharti Airtel (+6.08%), Asian Paints (+3.29%), Maruti (+3.26%), Tata Steel (+2.97%), and Bajaj Auto (+2.78%).
Meanwhile, foreign portfolio investors offloaded shares worth net Rs 333.59 crore, while domestic institutional investors (DIIs) bought shares to the tune of Rs 776.18 crore on Tuesday, as per provisional data.
In broader markets, the BSE Midcap and BSE Smallcap indices were up 0.7% and 0.9%, respectively. Hong Kong's Hang Seng was up 0.10 per cent while Japan's Nikkei gained 1.27 per cent in early trade today. London's FTSE rose 0.16% in late morning deals.