Indian government bond yields rose to their highest level this month on Thursday as bond prices declined, tracking a fall in US Treasuries after the US Federal Reserve Chair Jerome Powell’s post-policy remarks dampened expectations of another interest rate cut in December.
The benchmark 10-year bond yield climbed to 6.5502%, its highest intraday level this month, compared with 6.5354% at the previous close.
The US Federal Reserve on Wednesday cut its benchmark interest rates by 25 basis points (bps) to a range of 3.75%-4.00%. with two policymakers dissenting. Following the policy announcement, the probability of another rate cut in December dropped sharply to 68% from 91% prior to the meeting, according to the CME FedWatch Tool.
In reaction to Powell’s remarks, US Treasury yields rose, with the yield curve bear-flattening—two-year yields climbed 11 bps while 10-year and 30-year yields advanced around 9 bps each. The dollar…
