The broader NSE Nifty too slipped by 9.50 points, or 0.09%, to end at 10,118.25, after moving between 10,069.10 and 10,147.95.
The central bank kept the economic growth forecast unchanged at 6.7 percent for the fiscal ending March 31.
The 30-share Sensex opened on a negative note on across-the-board losses and touched a low of 32,682.52.
The wider Nifty hit a low of 10,033.35 before finishing at 10,044.10, down 74.15 points or 0.73 percent.
At 10.30 AM: Markets continued to trade in green during early morning trade on Friday.
The market breadth was in favour of the declines on Monday afternoon with 782 stocks advancing as against 868 declines.
Dalal Street saw investors hunting for bargains in recently-battered bank, auto and metal stocks, that came under the weather in the previous session on the back of the central bank's decision to hold repo rates in its sixth bi-monthly monetary policy meeting.
The Nifty PSU bank index gained as much as 1.2 percent, with State Bank of India and Bank of Baroda Ltd rising more than 1 percent each.
In broader markets, the BSE Midcap and BSE Smallcap indices were up 0.7% and 0.9%, respectively.
Emami shares jumped 2 percent.
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.
Other losers included Tata Steel, NTPC, Dr Reddy's, ONGC, Power Grid, Bajaj Auto, L&T, M&M, Asian Paints, HDFC Bank, HUL, Lupin, Coal India, ITC, Tata Motors, Axis Bank, Maruti Suzuki and Infosys, falling by up to 1.71 per cent.
Major Asian indices closed higher. Japan's Nikkei fell 1.97 percent, Hong Kong's Hang Seng shed 1.63 percent while China's Shanghai Index was down 0.29 percent, extending a retreat across Europe and NY. Shanghai Composite, however, shed 0.08 per cent.