- India's short-dated bonds are projected to outperform long-duration debt as the central bank is expected to keep interest rates on hold.
- Commercial banks are set for a large cash surplus, which traders expect will support short-dated yields.
- DBS Bank and Trust Asset Management see the yield curve steepening further after the 30-year and five-year yield gap widened to over 100 basis points following the RBI's June 5 capital flow measures.
Quotes
“India’s short-dated bonds will outperform debt with long duration, as the central bank is expected to keep interest rates on hold and banks are set for a large cash surplus”