On the domestic equity market front, the BSE benchmark Sensex was trading 160.58 points higher at 39,888.99, and the broader NSE Nifty rose 45.75 points to 11,726.10.
"Rising number of COVID-19 cases is prompting worries about a new wave of lockdowns in Europe and hopes from US stimulus spending are fading", Reliance Securities said in a research note.
The decline in the Index of Industrial Production (IIP) was 10.8 per cent in July. The contraction in August stood at 8 per cent, as per the latest data.
The newly-constituted MPC of the Reserve Bank began its three-day deliberations on Wednesday. The decision of the rate-setting panel will be announced on October 9.