Mumbai, Apr 16 (IANS): A benchmark index for Indian equities markets was trading 21 points higher in the afternoon session Monday on speculation that the Reserve Bank of India's (RBI) might cut interest rates for the first time in three years.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which opened at 17,047.87 points, was ruling 17,115.50 points in the afternoon trade, up 0.12 percent or 20.99 points from its previous close at 17,094.51 points.

The 50-scrip S&P CNX Nifty of the National Stock Exchange was trading 0.35 percent higher at 5,225.70 points.

There was good buying support in interest rates sensitive banking stocks on expectations of rate cuts. The country's largest lender State Bank of India was ruling 1.74 percent higher at Rs.2,249.90.

The RBI is scheduled to announce annual monetary policy for 2012-13 Tuesday.

The BSE banking index was trading 110.86 points higher at 11,995.07. Consumer goods too came out with healthy performance with a rise of about 98.22 points at 9,998.67.

The midcap index of the BSE was up 41.20 points while the smallcap index was ruling 31.76 points higher.