Indian bonds currently appear neutral to slightly attractive compared to the equity market, as well as their own historical performance during previous rate-cutting cycles, highlighted a report by SBI Mutual Fund. The report noted that with markets anticipating a softening of interest rates, bond yields are reflecting the possibility of future cuts. This shift in monetary policy has created a favourable environment for Indian bonds, particularly government bonds. "From a valuation standpoint, Indian bonds appear neutral to marginally attractive compared to the equity market and their own historical performance during the rate-cutting cycle" said the report. In addition, crude oil prices have moderated to around $77 per barrel, easing some inflationary pressures and further supporting bond markets.

Source: The Hindu October 13, 2024 00:01 UTC