India 10Y Yield Range-Bound into 2026

2026-01-02 09:22 By Joshua Ferrer 1 min. read

The yield on India’s 10-year G-Sec hovered around 6.6% to start 2026, trading in a narrow range, as traders turned cautious ahead of fresh debt supply and a heavy state borrowing calendar.

New Delhi plans to auction 320 billion rupees of the benchmark 10-year bond later today, while Indian states are expected to release their January-March borrowing plans, with investors bracing for a record quarterly supply of about 5 trillion rupees.

Meanwhile, the benchmark yield fell 17 basis points in 2025, its third straight yearly decline, supported by record RBI debt purchases and 125 basis points of rate cuts.

The central bank injected 11.7 trillion rupees into the banking system over the year, including 7 trillion in debt purchases, 2.2 trillion via FX swaps, and a 2.5 trillion rupee cut in banks’ cash reserve ratio, the largest single-year infusion on record.

Bond yields are expected to stay range-bound in early 2026, with near-term moves shaped mainly by state borrowing and RBI policy.



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