New Delhi: Stock markets are expected to remain volatile this week as Dalal Street will be buzzing with key events, including release of IIP, monthly inflation data and monetary policy, say experts.

"The week will be an eventful one for the domestic bourses as the IIP data, November monthly inflation figure and monetary policy are scheduled to be announced. Market is expected to remain volatile with a downward bias," Shanu Goel Senior Research Analyst Bonanza Portfolio said.

The IIP data will be announced on December 12, followed by November monthly inflation on December 14 and RBI monetary policy review on December 16.

Profit-booking in a truncated trading week saw benchmark Sensex closing 4 percent down last week.

The government's Mid-Year Analysis lowered the country's GDP growth forecast for this fiscal to 7.5 percent (plus\minus 0.25 percent) from the earlier projection of about 9 percent.

Expressing positive sentiments, Unicon Financial Services CEO Gajendra Nagpal said, "Markets may see a gap-up opening on Monday due to positive closing in the US stock market on Friday and as several key events are scheduled during the week, Indian indices will react on an event-to-event basis."

For the EU Summit's implications on the market, Nagpal said, "the event is already behind us."

The US stock markets had rallied on Friday with the Dow Jones Industrial Average ending up 1.55 percent, the S&P 500 index rose by 1.69 percent and Nasdaq Composite index was up 1.94 percent.

Kishor Ostwal, chairman and managing director, CNI Research, said, "The market should bounce back next week before the RBI reviews its policy on Friday."

Market observers said that a slowing economy could prompt the Reserve Bank to pause further rate hikes.