The government has adjusted its fiscal policy as the markets wanted. The RBI pivoted exactly when the market expected. Yet, the markets remain unimpressed. Why? 👉It’s not about the level of the yield curve. 👉It’s about the spread of the yield curve. Look at the difference between the 10-year bond yield (6.76%) and the 3-month bond yield (6.59%)—almost no gap. It’s a flat yield curve A flat yield curve like this signals uncertainty. What the RBI needs is yield curve management, ensuring a healthy spread between short-term and long-term bond yields. It’s need to create a upward sloping curve. With estimated inflation at 4.42%, why isn’t the RBI injecting more liquidity? Maybe it’s supporting the Rupee—just look at the drop in forex reserves. *~ Krushna Sharma* #investing #markets #forex #bonds