Note on RBI MPC by Puneet Pal, Head-Fixed Income, PGIM India Mutual Fund
Below the Note on RBI MPC by Puneet Pal, Head-Fixed Income, PGIM India Mutual Fund
“RBI has delivered a dovish policy today by announcing INR 1 trn of OMO purchases along with a 25bps cut in the policy repo rate. RBI also announced 3yr USD/INR Buy Sell swap of USD 5bn. This liquidity infusion along with rate cut more than fulfills market expectations and although we think that this is the last rate cut in this cycle, bond yields will get support from OMO purchases and the possibility of Indian government securities getting included in the Bloomberg Global aggregate Index. We expect the benchmark 10yr bond yield to trade in range of 6.30% to 6.60% over the next one month.”
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