RBI holds key rate at 5.25%, Indian yields barely move
Indian bond yields barely moved after the Reserve Bank of India (RBI) decided to keep its key interest rate at 5.25% for the fourth time in a row.
The central bank is playing it safe because of ongoing global tensions, especially the conflict in West Asia.
Falling crude oil prices also helped nudge the 10-year bond yield down slightly to 6.7793%.
RBI forecasts 5% inflation FY2027
The RBI now expects inflation for fiscal 2027 to be 5%, a bit lower than before, but warns that rising food and fuel costs could still push prices up.
As Governor Sanjay Malhotra put it, "Global economic conditions and sentiments continue to remain hostage to the rapidly oscillating developments, both in scale and intensity of the West Asia conflict," with events in West Asia still making things unpredictable for India's economy and markets.