CURVE

In this issue, we cover:

• Market Moves: India’s 10Y G-sec yield rose 21 bps to 7.39%, reflecting pressure from the RBI rate hike and higher crude, while the US 10Y yield eased 20 bps to 5.09%

• Global Rates: Global yields were mixed, with Japan, China, and German 10Y yields easing, while domestic yields moved higher during the period.

• Macro Indicators: CPI inflation continues to trend higher to 5.54%, and the trade deficit widened to $30.21 bn, while surplus liquidity moderated sharply to ₹2.42 lakh crore.

• FPI Highlight: Equity flows remained under pressure with ₹47,955 crore MTD outflows, while debt flows turned positive at ₹2,067 crore MTD.

• Segment Highlights:

i.                    Money Market: CP/CD rates rose 15–57 bps across most maturities following RBI measures to drain surplus banking liquidity.

ii.                  G-secs: Yields hardened across the curve amid the RBI rate hike & change in stance to “Calibrated Tightening”, higher crude price, domestic inflationary pressures, and liquidity absorption.

iii.                SDLs: Yields tracked higher G-secs, with a heavy state borrowing calendar adding to pressure.

iv.                 Corporate Bonds: AAA PSU yields moved higher alongside G-secs, with primary-market pricing also exerting pressure.

• Product Snapshot: Covers category performance benchmarks and our full range of active and passive fixed income products.

CURVE reflects our continued commitment to provide relevant debt market updates. 

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