10-year bond yield may trade in 6.60-6.90% range over the next month: PGIM India MF's Puneet Pal

PGIM India MF expects the 10-year bond yield to trade in the 6.60-6.90% range over the next month, with the Monetary Policy Committee likely raising rates in H2 FY27 to maintain positive real rates, even as average CPI inflation for FY27 is projected below 5%. Foreign portfolio investors pumped in over $900 million into Indian debt in the first 10 days of July, while equities saw FPI inflows for the first time in four months. Meanwhile, the monsoon deficit narrowed to 15% of the long-term average, though kharif sowing lagged by 21% year-on-year, banking deposit growth accelerated to 13.3%, credit growth held at 18.6%, and the rupee remained under pressure despite easing crude prices.