Reuters Market Eye - The Sensex falls around 0.3 percent. Interest rate-sensitive stocks fall, with Tata Motors Ltd (TAMO.NS) down 2.3 percent and ICICI Bank (ICBK.NS) down 0.9 percent, after the RBI chief was reported by media as saying inflation was "still quite high", denting hopes of a 50 basis points rate cut this month.
"It is a decline from the peak, but it is still quite high," Subbarao was quoted by Dow Jones Newswires as saying about the December data in an address to management students in the northern city of Lucknow on Tuesday.
Shares of software services exporters fall on profit-booking after stronger-than-expected earnings boosted the shares in recent sessions.
Infosys Ltd (INFY.NS) fall 0.5 percent and Tata Consultancy Services (TCS.NS) is down 1.3 percent.
(Reporting by Abhishek Vishnoi)