India 10-year benchmark govt bond yield at 6.7143% vs 6.7214% previous close
TL;DR
India's 10-year government bond yield slightly decreased to 6.7143% due to RBI interventions and inflation data within tolerance. Factors include debt-switch initiatives, global influences from US yields, and upcoming bond issuances, with forecasts predicting further easing.
India 10-year benchmark govt bond yield at 6.7143% vs 6.7214% previous close
India 10-Year Benchmark Govt Bond Yield Edges Lower Amid RBI Interventions and Inflation Data
The yield on India’s 10-year government securities (G-Secs) fell to 6.7143% on February 22, 2026, from 6.7214% in the previous session, marking a slight decline amid evolving market dynamics. The move follows the Reserve Bank of India’s (RBI) recent debt-switch initiative, where INR 755 billion of fiscal 2027-maturing bonds were bought back and replaced with longer-dated 2040 securities, easing near-term redemption pressures and reducing gross borrowing needs.
Investors are also factoring in January inflation data, which rose to 2.75%, remaining within the RBI’s 2%-6% tolerance band but exceeding market expectations. This outcome limited upward pressure on yields, supported by steady liquidity conditions and modest declines in short- and medium-term overnight indexed swap (OIS) rates. However, borrowing-related pressures persist, with state-run firms planning to raise approximately $1.9 billion through bond issuances this week, including 10-year, 5-year, and perpetual instruments.
Global factors further influenced sentiment. US 10-year Treasury yields climbed to 4.18% following stronger-than-expected non-farm payrolls data, dampening expectations of near-term Federal Reserve rate cuts and indirectly weighing on Indian bonds. Meanwhile, foreign banks have been active in purchasing short-term certificates of deposit, providing some relief to domestic liquidity stress despite tight funding conditions.
The RBI’s interventions, including bond purchases that injected INR 3 trillion into the financial system, have helped stabilize market conditions. Analysts note that sustained easing in yields may require continued central bank support or additional fiscal measures. Looking ahead, investors remain attentive to upcoming debt auctions and broader macroeconomic developments for signals on the near-term trajectory of yields.
Forecasts suggest the India 10-year bond yield is expected to trade at 6.71% by the end of the quarter and 6.59% in 12 months, according to Trading Economics models.
