India 10-year yield rises to 6.94% after excise duty cut
Business
India's 10-year government bond yield just hit its highest point since July 2024, climbing to 6.94% after the government slashed excise duty on petrol and diesel.
This move has made investors a bit uneasy about the country's fiscal health, especially with oil prices still high and investor sentiment unsettled.
Government fuel tax cut 7000cr fortnightly
Cutting fuel taxes is expected to cost the government around ₹7,000 crore every two weeks, adding up to a possible ₹1.75 lakh crore hit by fiscal 2027.
With Brent crude hovering near $110 a barrel, there are worries about rising inflation and a growing current account deficit.
Plus, key financial rates like overnight index swaps have also surged to multi-year highs, signaling more pressure on India's economy ahead.