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Indian 10-year yield nears 7.2% as inflation and liquidity worries grow
The domestic 10-year benchmark rose about 30 basis points in September to roughly 7.2%, with global yields and tighter liquidity adding pressure.
India’s bond market is heading into October facing a mix of strong domestic growth and mounting inflation concerns, including higher global yields and tighter liquidity conditions, according to LiveMint Markets.
The article says the domestic 10-year benchmark yield climbed about 30 basis points in September to approximately 7.20%, after a roughly 11-basis-point rise in August, while it stood at 6.6% at the start of the year.
LiveMint Markets links the move to global rates, noting the US 10-year Treasury yield rose around 53 basis points to 5.22%, and cites factors including US-Iran tensions, elevated oil prices above US$100 per barrel, central bank policy, and potential additional bond supply.
The outlet also highlights expectations that the RBI will raise the repo rate by 50 to 75 basis points amid inflation risks driven by higher food and oil prices, and says shorter-tenure corporate bonds and dynamic bond funds may offer better flexibility for different risk profiles.