Perspective on RBI MPC announcement By Mr. Nitin Shanbhag, Motilal Oswal Private Wealth
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Below is perspective on RBI MPC announcement By Mr. Nitin Shanbhag, Sr. Executive group VP- Motilal Oswal Private Wealth.
“The 50 bps repo rate hike was already factored in with 1 year G-sec yield already trading at 6% pre policy. The yield curve is quite steep and is likely to continue to flatten going forward. The prevailing term spread between the 10 year and 5 year yield is not attractive relative to historical spreads. Hence, for Fixed Income portfolios, we suggest core allocation to the 4-5 year maturity segment in high credit quality, target maturity debt funds which invest in a combination of G-sec, SDL, and AAA-rated instruments.”
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