In line with market expectations, the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) reduced the repo rate by 25 basis points (bps) to 6.25 per cent. This marks the first rate cut since May 2020,

Lower interest rates generally push bond prices higher as investors lock in better yields from existing bonds. However, Apurva Sheth, Head of Market Perspectives & Research at SAMCO Securities, noted that India's 10-year bond yields spiked after the rate cut since the market had already factored in the decision,

After the RBI MPC, experts say the overall situation in the debt market remains bond-positive, with a clear expectation of further rate cuts and a favourable demand-supply mix.

The Reserve Bank of India (RBI) reduced its key repo rate on Friday for the first time since May 2020, aiming to provide stimulus to the sluggish economy, which is projected to grow at its slowest pace in four years during the current fiscal year.

A reduction in interest rates typically has a significant impact on debt funds, particularly in terms of bond prices, yields, and the overall returns they generate for investors.

Indian state-run companies are set to borrow nearly $2 billion via the bond market early next week after the central bank cut interest rates for the first time in nearly five years.

On Friday, the Reserve Bank of India’s (RBI) six-member Monetary Policy Committee (MPC) reduced the repo rate, the rate at which the RBI lends to commercial banks by 25 basis points, bringing it down to 6.