India Benchmark Bond Yield Breaks 3-Week High as Oil Rises; GDP data to come
By Malvika Gurung
Investing.com — Global prices are up on Tuesday, breaking above $120/barrel to hit $122.30/barrel in early trading, after European Union leaders agreed to cut 90% oil imports from Russia by the end of 2022.
This has fueled concerns of an even tighter market, which is already mired in supplies amid growing demand, in an already tight current environment.
Due to rising oil prices, India’s benchmark 10-year bond yield hit a three-week high in early trading today on concerns that the RBI may be forced to raise further. interest rates to control soaring inflation, so that domestic growth is not hampered.
The benchmark bond yield traded at 7.46% at 11:36 a.m., its highest level since May 9.
A senior trader suggested that the rise in crude oil prices is an indicator that upward pressure on domestic inflation is likely to continue, erasing any expectation of lower inflation in the near term.
Moreover, taking all these factors into account, economists have predicted India’s GDP to grow with a lag in the fourth quarter of FY22 of around 4% (according to a Reuters poll), the fastest pace. slower in a year.
Official data on domestic GDP growth will be released by the government at 12:00 GMT on May 31, 2022.
Read more: Ahead of official GDP data release, here’s what economists predict for Q4 and FY22