Traders Bet RBI May be Done With Hikes Despite Hawkish Tone
- 10-year yields rose only 3 basis points after hawkish RBI
- Swaps hint RBI may cut rates in early 2024: PGIM India
The central bank’s hawkish bent came amid global turmoil in bonds after a red hot US jobs report spurred expectations of further hikes by the Federal Reserve.
Photographer: Dhiraj Singh/BloombergThis article is for subscribers only.
Some traders in India’s bond market are betting that the central bank may have actually reached the peak of its rate hikes, even as the monetary authority sounded hawkish in its policy.
The yield on 10-year bonds rose only three basis points on Wednesday after the Reserve Bank of India kept the door open for further policy tightening, reflecting the market’s outlook on rates. Swaps indicate the RBI may start cutting rates in the first quarter of next year, according to PGIM India Asset Management Pvt.