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Economic Times
3 days ago
- Business
- Economic Times
RBI rate pause offers a window of opportunity for fixed-income investors
The Reserve Bank of India (RBI) held the repo rate steady at 5.50% in August. This decision comes after earlier rate cuts. The RBI is watching global and domestic conditions. Inflation is low, but the RBI expects it to rise. Global trade tensions and US policies are key factors. Experts suggest investors consider fixed deposits and bonds. Tired of too many ads? Remove Ads Balancing Growth and Global Risks Tired of too many ads? Remove Ads What It Means for Fixed-Income Investors In its latest Monetary Policy Committee (MPC) meeting, the Reserve Bank of India ( RBI ) maintained a status quo on the repo rate at 5.50% in August, marking a cautious stance amid a rapidly evolving global and domestic frontloading 100 basis points (bps) in rate cuts since February 2025, the central bank now appears to be in a 'wait-and-watch' mode, balancing subdued inflation with emerging macroeconomic to Vishal Goenka, Co-Founder of 'RBI as expected kept rates unchanged at the policy meeting in the face of uncertainty due to tariffs. With inflation expectations down to 3.1% and growth projections steady at 6.5%, they have created optionality for now.' He adds that future rate actions will likely be guided by developments on the US policy front and the fallout from new tariff decision to hold comes despite a sharp moderation in inflation. June's CPI print came in at a 77-month low of 2.1%.Still, the RBI sees risks ahead, revising its full-year CPI forecast for FY26 to 3.1% but anticipating inflation to rise above 4% in the final quarter due to base effects and demand-side Kuppa, Director at Bidd, notes that while rural demand, a normal monsoon, and public capital expenditure are supporting the domestic economy, global conditions are once again turning turbulent. 'The US has imposed 25% tariffs on all exports, which could impact India's GDP growth. The RBI has rightly flagged trade negotiation challenges in its forward outlook.'The MPC's neutral stance gives investors clarity: there's no imminent rate hike, but room for further cuts exists if global conditions deteriorate. However, this also signals that the RBI wants to see how the previous rate cuts filter through the broader financial system before acting investors, this could be the final opportunity to lock in attractive yields, whether through fixed deposits or high-quality bonds Kuppa explains, 'FD and bond rates may not fall significantly in the near term, but the risk is clearly to the downside. Banks may continue to pass on earlier rate cuts in the coming months.''Investors should remain diversified, especially with volatility expected to rise due to global trade tremors and election-led uncertainties. For borrowers, the pause may delay further EMI reductions, but the cumulative 100 bps cut this year still offers relief,' he adds that long-end bond yields may remain under pressure, which benefits investors who enter now. 'We continue to see robust growth in the corporate bond market this year—both from the supply and demand side. Interestingly, the RBI acknowledged that large corporations have been agile in tapping bond markets, particularly as the transmission of rate cuts through traditional channels remains slow.': Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
Time of India
3 days ago
- Business
- Time of India
RBI rate pause offers a window of opportunity for fixed-income investors
Balancing Growth and Global Risks Live Events What It Means for Fixed-Income Investors (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel In its latest Monetary Policy Committee (MPC) meeting, the Reserve Bank of India ( RBI ) maintained a status quo on the repo rate at 5.50% in August, marking a cautious stance amid a rapidly evolving global and domestic frontloading 100 basis points (bps) in rate cuts since February 2025, the central bank now appears to be in a 'wait-and-watch' mode, balancing subdued inflation with emerging macroeconomic to Vishal Goenka, Co-Founder of 'RBI as expected kept rates unchanged at the policy meeting in the face of uncertainty due to tariffs. With inflation expectations down to 3.1% and growth projections steady at 6.5%, they have created optionality for now.' He adds that future rate actions will likely be guided by developments on the US policy front and the fallout from new tariff decision to hold comes despite a sharp moderation in inflation. June's CPI print came in at a 77-month low of 2.1%.Still, the RBI sees risks ahead, revising its full-year CPI forecast for FY26 to 3.1% but anticipating inflation to rise above 4% in the final quarter due to base effects and demand-side Kuppa, Director at Bidd, notes that while rural demand, a normal monsoon, and public capital expenditure are supporting the domestic economy, global conditions are once again turning turbulent. 'The US has imposed 25% tariffs on all exports, which could impact India's GDP growth. The RBI has rightly flagged trade negotiation challenges in its forward outlook.'The MPC's neutral stance gives investors clarity: there's no imminent rate hike, but room for further cuts exists if global conditions deteriorate. However, this also signals that the RBI wants to see how the previous rate cuts filter through the broader financial system before acting investors, this could be the final opportunity to lock in attractive yields, whether through fixed deposits or high-quality bonds Kuppa explains, 'FD and bond rates may not fall significantly in the near term, but the risk is clearly to the downside. Banks may continue to pass on earlier rate cuts in the coming months.''Investors should remain diversified, especially with volatility expected to rise due to global trade tremors and election-led uncertainties. For borrowers, the pause may delay further EMI reductions, but the cumulative 100 bps cut this year still offers relief,' he adds that long-end bond yields may remain under pressure, which benefits investors who enter now. 'We continue to see robust growth in the corporate bond market this year—both from the supply and demand side. Interestingly, the RBI acknowledged that large corporations have been agile in tapping bond markets, particularly as the transmission of rate cuts through traditional channels remains slow.': Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
Mint
29-07-2025
- Business
- Mint
The Bond Boom: New section can be your guide to a balanced portfolio
Indian capital markets are currently experiencing heightened volatility due to global trade realignments and geopolitical shifts. Even though equities have long dominated the headlines, the need for stable, predictable returns has never been more apparent. This is where fixed-income investments, specifically bonds, are emerging as crucial components of well-balanced portfolios. This growing maturity of the Indian bond market is evident in the numbers. According to data compiled by the Reserve Bank of India (RBI), the Indian corporate bond market saw a record issuance of ₹ 9.9 lakh crore in FY25, which is a 28 per cent increase over the previous year. To help you navigate this market, Livemint has introduced Bond Street, a specialised Bonds section under Market, powered by IndiaBonds. This dedicated space has been designed to be your comprehensive guide to the world of bond investing, as it empowers you with all the resources you need for the fixed income category. 'With Bond Street, Livemint deepens its commitment to empowering investors with timely, insightful coverage of fixed income markets – both in India and globally. In today's volatile environment, as investors seek to navigate the challenges of rising interest rates, geopolitical risks, and economic uncertainty, this marks a crucial step in expanding informed portfolio diversification for our readers,' said Binoy Prabhakar, Chief Content Officer, Hindustan Times Digital. In this section, you can stay abreast with the latest developments in the bond market, including new issuances, policy changes, and expert analysis in Bond News. You can also find out more about different kinds of bonds available in India in Explore Bonds or go to Videos to get access to a curated series of AV material demystifying financial concepts like 'What are Corporate Bonds?' or 'Mutual Funds and Bonds: The Perfect Duo'. 'We at IndiaBonds are excited to join hands with MINT in a strategic alliance to drive awareness, education, and access around Bonds. This alliance strengthens our commitment to making the fixed income category mainstream and relatable to the national investor base. MINT is among India's most respected and premium business publications, known for its sharp insights and credible journalism,' said Vishal Goenka, Co-Founder, IndiaBonds. He added, 'The Indian bond market remains one of the final frontiers for financial inclusion and through this collaboration, we hope to strengthen the content ecosystem and education for bond investments.' Livemint's partnership with IndiaBonds also offers you access to an exclusive learning platform, Bond University, to offer insights on the fundamentals of bond investing. There is a weekly feature, Bond of the Week, which introduces you to a new bond category every week with a detailed analysis of its features, risks, and potential returns. Further, the Frequently Asked Questions (FAQs) section offers quick answers to common queries that you may have about this asset class. So, whether you are a seasoned investor or someone just starting out your journey into the world of bond investing, this new section can become your invaluable resource bank. Explore how bonds can add the diversification you need in your investment portfolio by visiting the new section today! Click here to find out more.
Time of India
25-07-2025
- Business
- Time of India
Resurgence of India rate-cut wagers revives foreign investor interest in bonds
Foreign appetite for Indian government bonds is back, with inflows picking up steadily over the last month, as investors gauge fresh expectations of a rate cut by the Reserve Bank of India as early as August. The RBI cut rates by a larger-than-expected 50 basis points in June and changed the stance to "neutral", prompting investors to bet on a prolonged pause. Explore courses from Top Institutes in Please select course: Select a Course Category PGDM Data Science Public Policy Management Product Management Project Management CXO Digital Marketing Data Analytics Leadership Others healthcare Design Thinking Artificial Intelligence others Finance MBA Cybersecurity MCA Technology Degree Data Science Healthcare Skills you'll gain: Financial Analysis & Decision Making Quantitative & Analytical Skills Organizational Management & Leadership Innovation & Entrepreneurship Duration: 24 Months IMI Delhi Post Graduate Diploma in Management (Online) Starts on Sep 1, 2024 Get Details by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Gold Is Surging in 2025 — Smart Traders Are Already In IC Markets Learn More Undo But a sharp drop in June retail inflation has some investors reassessing the likelihood of another rate cut. Bonds Corner Powered By Resurgence of India rate-cut wagers revives foreign investor interest in bonds Foreign investors are showing renewed interest in Indian government bonds, driven by expectations of an upcoming rate cut by the Reserve Bank of India as early as August. Subdued inflation and persistent growth concerns are fueling these expectations. Over the past month, foreign investors have net purchased 129 billion rupees in Indian bonds. Three Indian infra investment trusts eye $500 million debt in coming weeks, sources say Grip Invest launches auto compounding investment product for bond investors Despite RBI's rate cuts, Indian G-Sec yields remain range-bound due to US yield pressures, says Rajkumar Subramanian US Treasury pullback from long-term bonds signals policy divergence, says Vishal Goenka Browse all Bonds News with The RBI could implement a modest 25 basis point cut in August if inflation remains subdued and growth concerns persist, said Singapore-based Manish Bhargava, CEO of Straits Investment Management, adding that bond yields are attractive at current levels. Over the last one month, foreign investors have net bought 129 billion rupees ($1.5 billion) of Indian bonds linked to global indexes after selling more than 330 billion rupees in the first two-and-a-half months of the financial year that started on April 1, clearing house data showed. Live Events Analysts said concerns on the growth front are also likely to prompt the central bank to lower rates further. With recent high-frequency data disappointing and indicating the possibility of a further slowdown in growth, "there is potential for more support from the RBI further down the line," said London-based Giulia Pellegrini, lead portfolio manager, emerging market debt at AllianzGI. India's overall economic fundamentals remain solid, keeping the country on investors' radar, she said. A wider gap between interest rates in India and the U.S. would add to the appeal of Indian debt, investors said. That's why a Federal Reserve rate cut could act as a positive catalyst for Indian bonds, as they have historically helped local currency debt markets, said Nigel Foo, Singapore-based head of Asian fixed income at First Sentier Investors. However, current Indian bond yields are lower than where they were in the past at similar policy rate levels, and so are relatively unattractive, he added. The 10-year U.S. yield was around 4.35%, with the Fed expected to cut rates by at least 50 bps in 2025. The Indian 10-year benchmark bond yield was at 6.30%. "India's local debt story remains very compelling on both FX and rates," said Jean‑Charles Sambor, head of emerging markets debt at TT International Asset Management in London, who expects bond yields to decline through this year and next, and finds the middle of the yield curve attractive. ($1 = 86.2470 Indian rupees)
Time of India
24-07-2025
- Business
- Time of India
Three Indian infra investment trusts eye $500 million debt in coming weeks, sources say
Three Indian infrastructure investment trusts , including the National Highways Infrastructure Trust , are planning to raise up to 43 billion rupees ($499 million) through corporate bonds in the coming weeks, three sources familiar with the matter said. NHIT is in talks with merchant bankers and investors to raise around 15 billion rupees through three-year bonds, the sources, who did not want to be named because the discussions are private, said. Explore courses from Top Institutes in Please select course: Select a Course Category Data Science MCA Operations Management CXO others Project Management Cybersecurity Degree Healthcare Data Analytics Public Policy Design Thinking Management Leadership Artificial Intelligence Data Science Technology Others MBA Digital Marketing PGDM healthcare Product Management Finance Skills you'll gain: Duration: 30 Weeks IIM Kozhikode SEPO - IIMK-AI for Senior Executives India Starts on undefined Get Details Skills you'll gain: Duration: 11 Months E&ICT Academy, Indian Institute of Technology Guwahati CERT-IITG Postgraduate Cert in AI and ML India Starts on undefined Get Details Skills you'll gain: Duration: 11 Months IIT Madras CERT-IITM Advanced Cert Prog in AI and ML India Starts on undefined Get Details Skills you'll gain: Duration: 10 Months E&ICT Academy, Indian Institute of Technology Guwahati CERT-IITG Prof Cert in DS & BA with GenAI India Starts on undefined Get Details Skills you'll gain: Duration: 10 Months IIM Kozhikode CERT-IIMK DABS India Starts on undefined Get Details by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like This Could Be the Best Time to Trade Gold in 5 Years IC Markets Learn More Undo Cube Highways Trust is likely to tap the market for about 10 billion rupees in debt, with maturities ranging between three and five years. Bonds Corner Powered By Three Indian infra investment trusts eye $500 million debt in coming weeks, sources say Three Indian infrastructure investment trusts, including the National Highways Infrastructure Trust, are planning to raise up to 43 billion rupees ($499 million) through corporate bonds in the coming weeks, three sources familiar with the matter said. Grip Invest launches auto compounding investment product for bond investors US Treasury pullback from long-term bonds signals policy divergence, says Vishal Goenka Corporate bond curve in 3–6-year segment offers investment opportunity amid rate cut hopes: PGIM India MF Airport Firm GMR mulls rupee-bond sale of Rs 5,000 crore Browse all Bonds News with Meanwhile, IRB Infrastructure Trust is preparing for its debut bond issuance, targeting roughly 18 billion rupees through a dual-tranche offering with five and 10-year tenors. None of the infrastructure investment trusts , or InvITs, responded to Reuters emails seeking comment. InvITs typically raise capital through a combination of units and bonds. Live Events Bond issuances have gained traction in recent months amid falling yields. According to Prime Database, InvITs and real estate investment trusts (REITs) together raised more than 178 billion rupees in the January-June period. All three InvITs are in discussions with investors, including the International Finance Corporation, which has previously invested in debt issued by several InvITs, including Cube Highways, according to a termsheet from an earlier offering. NHIT last tapped the bond market in January, while Cube Highways raised funds through bonds in April. Insurance firms and pension funds participated in NHIT's previous bond offering, and the sources said they expect mutual funds to show interest this time, given that the tenor aligns with their investment horizon. ($1 = 86.3825 Indian rupees)
