Indian Bond Yields Steady As Traders Focus On Fed Moves

Indian bond yields were steady on Tuesday, as traders awaited cues from the Federal Reserve's policy meeting later this week. The 10-year bond yield was at 7.34%, little changed from its previous close. The Reserve Bank of India (RBI) is widely expected to keep interest rates on hold at its meeting on Wednesday, but traders will be looking for any signals on the central bank's future policy stance.

The Fed is expected to raise interest rates by 25 basis points at its meeting on Wednesday, and traders will be watching for any signals on the pace of future rate hikes. The Fed has indicated that it will continue to raise rates gradually, but the pace of rate hikes could slow if the economy weakens. Traders will also be watching for any comments from the Fed on the global economy and the impact of the trade war between the US and China.

The Indian bond market has been under pressure in recent months due to concerns about rising inflation and the impact of the trade war on the economy. However, the RBI has taken steps to support the bond market, including buying bonds in the secondary market. The RBI is also expected to announce measures to support the bond market at its meeting on Wednesday.

Traders will also be watching for any developments in the trade war between the US and China. The trade war has already had a negative impact on the global economy, and a further escalation could lead to a sharp sell-off in the bond market. However, there are also hopes that the two sides will be able to reach a deal, which could provide some relief to the bond market.

Overall, the Indian bond market is likely to remain volatile in the near term. Traders will be looking for cues from the Fed's policy meeting later this week and any developments in the trade war between the US and China.