Global bond rout hoists benchmark Indian yield to mid-2024 high before RBI policy

The Indian benchmark 10-year yield has reached its highest level since April 2024, as a global bond selloff continues to put upward pressure on yields. This significant increase in yields is largely driven by rising global yields and heightened inflation pressures. The Reserve Bank of India's upcoming policy meeting next week is expected to bring a rate hike, which could further impact bond yields. The RBI's decision will be closely watched as it navigates the challenges of excessive liquidity in the banking system.

Why it matters

A significant selloff in Indian government bonds occurred as global yields rose and inflation pressures heightened. The Indian benchmark 10-year yield reached a mid-2024 high, indicating a decrease in bond prices.

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