What’s going on here?
Indian bonds remain resilient with inflation on a downward trend in both India and the US, keeping Indian bond yields stable while easing concerns, even as US Treasury yields rise.
What does this mean?
India’s 10-year government bonds are expected to stay around 6.67% to 6.70%, boosted by favorable inflation dynamics in both regions. While the US consumer price index nudged up 0.2% in February, slightly off predictions, India saw a dip in retail inflation to 3.61%, hinting at possible rate cuts by the Reserve Bank of India (RBI). Kotak Mahindra Bank anticipates 25 basis point reductions in April and June, with expectations of the RBI taking an ‘accommodative’ stance. Meanwhile, US Treasury yields have surpassed 4.30%, coupled with global trade tensions posing challenges. To support the market, the RBI has snapped up bonds totaling 500 billion rupees, with more purchases planned, alongside conducting hefty repo…
