ETMarkets Smart Talk | Rate-cut cycle over, RBI may be at cusp of rate hikes; yields could inch higher: Puneet Pal
PGIM India’s Puneet Pal expects India’s rate-cut cycle to end and policy rates to rise 50-75 basis points by FY27 amid higher crude and sticky inflation. He sees rising yields creating opportunities in high-quality corporate bond and target-maturity funds.
The Indian fixed-income market is transitioning from a rate-cut cycle to a potential rate-hiking phase, according to Puneet Pal, Head of Fixed Income at PGIM India Mutual Fund. Pal anticipates that the Reserve Bank of India (RBI) may raise policy rates by 50-75 basis points by the end of FY27, leading to an increase in bond yields.
Despite rising yields, Pal sees opportunities for investors, particularly in high-quality corporate bond funds and target-maturity funds, over the next six months. He advises investors to consider their investment horizon and risk appetite, with a phased approach to investing in the current environment of rising crude oil prices, elevated global bond yields, and sticky inflation.
Brief written by urgent.news from The Economic Times - Top News's own syndicated text. Machine-written — may contain errors; check the original before relying on it.
