Rate cuts were pencilled in only in 2024. A runaway rise in yields should be unlikely as the chances of rate hikes by the RBI are thin. But the weekly bond auctions and states’ bond sales will soon start to tell the real story. The corporate bond issuances are expected at over ₹9 trillion this year, beating a record high of ₹8.2 trillion issues hit last year.Irrespective of all the pressures the bond market will likely endure this year, yields are unlikely to surge beyond a point. The bond market will start to believe that rate cuts have been delayed but won’t be denied for long.Come December, such hopes will remerge.

Source: Economic Times June 19, 2023 11:25 UTC