'Bond market investors are likely to chase yields in the coming months'

The RBI may need to step in with larger purchases soon to keep yields from rising.This size of weekly auction can be absorbed in the market only if there is confidence on low yields, he says

After a stellar rise in the equity markets since March 2020 low, BADRINIVAS NC, head of markets and securities services for Citi South Asia tells Puneet Wadhwa that the near-term upsides in the broader equity market remains capped and their model portfolio is overweight in select sectors like financials, telecom, industrials, and healthcare. Edited excerpts:

Did the Reserve Bank of India’s (RBI’s) recent stance on rates come as a surprise?
 

The recent pause by the Reserve Bank of India (RBI) in interest rates was no surprise, given inflation is higher than the targeted band. It is not easy to predict