Indian government bonds rally on yield drop
Indian government bonds rallied on Wednesday, with the 10-year yield dropping to 6.5551% as of September 3, 2025.
Investors are betting the RBI and government will step in to calm recent market swings, pushing bond prices higher.
Cheaper borrowing and market boost
Lower yields mean cheaper borrowing for the government and a boost in overall market mood.
With many investors nursing losses lately, there's hope that fresh support from the RBI—and some fiscal clarity—could steady things.
RBI talks to players about government borrowing needs
The RBI has been talking with market players about how much the government needs to borrow for the rest of this year, especially as debt supply rises.
Even with talk of GST tax cuts raising questions about funding, officials have stuck to their fiscal deficit target of 4.4% of GDP for FY26.
The latest GST Council meeting (September 3-4) was expected to provide more policy direction at a crucial time.