Indian government bonds likely to open weaker today
Indian government bonds are expected to open weaker this Monday, with 10-year yields likely to tick up slightly.
Investors are feeling cautious thanks to big changes in India's tax system and rising US Treasury yields.
India's fiscal pressure could lead to higher bond yields
The biggest tax overhaul since 2017, rolling out in October, will make essentials and electronics cheaper but could cost the government over ₹1.2 lakh crore a year—about 0.4% of India's GDP.
This could increase fiscal pressure and borrowing needs, which usually pushes bond yields higher and can affect anyone interested in fixed-income investments.
US Treasury yields have also risen recently
It's not just local news—US 10-year Treasury yields jumped by 7 basis points recently, putting extra pressure on Indian markets.
While short-term rates at home are steady for now, long-term borrowing costs are feeling the heat from both fiscal strain and global interest rate moves.