Investors Dump Indian Bonds After Hawkish RBI Minutes
· Business · Economic Times, Bloomberg
Domestic Indian bonds faced heavy selling pressure on Thursday after the Reserve Bank of India released policy minutes indicating a willingness to raise interest rates. The 10-year benchmark bond yield climbed 5 basis points to 6.8709 percent, reaching its highest level since June 15. Governor Sanjay Malhotra stated that emerging inflation risks could warrant policy tightening, reviving market expectations of higher borrowing costs. Rising Brent crude futures, which hit USD 94 a barrel in Asian trade, further compounded inflationary pressures for India as the world's third-largest oil importer. Retail inflation in July stood at 4.45 percent, remaining above the central bank's 4 percent medium-term target.
Why it matters
Higher bond yields signal rising borrowing costs for businesses and the government across India.
Read the original report — Economic Times
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