Rupee on the Rise: RBI Policy Minutes Spark Market Buzz, Bond Yields in Spotlight

MUMBAI, April 21, 2025 – The Indian rupee is gearing up for a gentle climb this week, riding high on strong foreign investment flows and a weakening US dollar. Last week, the rupee wrapped up at 85.3675, notching a 0.8% gain as overseas investors pumped over $1.5 billion into Indian stocks. The upbeat mood is further lifted by easing global trade tensions, which are brightening the outlook for Asian currencies.

Meanwhile, bond markets are on alert as investors await fresh signals from the Reserve Bank of India’s (RBI) latest policy minutes. The benchmark 10-year bond yield dipped to its lowest since December 2021, closing last week at 6.37%. Market watchers expect yields to hover between 6.30% and 6.40%, with the RBI’s recent rate cuts and liquidity boosts setting a supportive tone.

Economists predict the central bank could continue its rate-cutting streak if inflation stays under control and economic growth slows. With the RBI maintaining an “accommodative” stance and surplus liquidity, the market is primed for further easing—especially if the monsoon season brings good news.

Source: Reuters