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RBI's Enchanted Adventure to Conquer Wild Yields with Bonds

RBI's Enchanted Adventure to Conquer Wild Yields with Bonds

In the mystical land of India, the Reserve Bank is brewing up a potion of liquidity to combat the unruly yields that refuse to budge! By the time the stars align in March 2027, they aim to conjure ₹5 trillion in bonds. Despite their spellbinding efforts, only a mere 10% of their charms have worked, leaving wizards and witches scratching their heads over the bond vs. bank loan conundrum.

Quick rundown

  1. India's central bank faces transmission trouble with bond yields.
  2. RBI expected to buy up to ₹5 trillion in bonds by March 2027.
  3. Despite rate cuts, only 10% of reductions have affected bond yields.
  4. RBI's forex operations to support the rupee have drained liquidity.
  5. A potential US trade deal could ease growth concerns and bond purchases.

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