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Explainer: Why global factors are now influencing Indian bonds
Indian government bonds, once mostly shielded from outside events, are now reacting more to shifts in the global economy and politics.
This became clear after the RBI's big rate cut and liquidity boost in February 2025, which pushed 10-year bond yields down to their lowest since mid-2021.
What does this mean for India?
If you care about investing or just want to understand how India's money scene works, here's the deal: what happens abroad—like US interest rates or trade tensions—now impacts Indian borrowing costs more than ever.
The RBI is expected to keep an eye on the world stage before making its next moves.
Even with these pressures, India's economy showed strength with a solid 7.8% GDP growth in Q1 FY2025-26—so there's still plenty of resilience at home.