MUMBAI (Reuters) - Bonds, stocks and the rupee all fell on Tuesday after the DMK out of the ruling UPA coalition and after the RBI issued a statement that was seen as cautious on future rate cuts.
The 10-year bond yield rose as much as 7 basis points to 7.92 percent from levels before TV channels reported the Dravida Munnetra Kazhagam (DKM) had withdrawn from the ruling coalition.
The political uncertainty came on the day Reserve Bank of India cut interest rates but disappointed investors with a statement seen as cautious on monetary policy.
The rupee weakened to as much as 54.36 per dollar and was last trading at 54.29/30 as of 11:31 a.m. from around 54.06/07 before the RBI decision and statement. The Sensex was down 1.1 percent.
(Reporting by Mumbai markets team; Editing by Anupama Dwivedi)
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