Manoj Swain, Head of Fixed Income of Standard Chartered Bank is not expecting a rate hike in today's credit policy. In case of a no rate hike, he sees the 10-year yield at 8%. In case of a rate hike, he sees the 10-year yield at 8.25%. Swain expects the economic growth to slowdown to 7.5%.

Excerpts from CNBC-TV18’s exclusive interview with Manoj Swain:

Q: What are you going with?

A: The macro economic report yesterday takes note of moderation in growth both in domestic and world economy and we also expect growth to slow down to 7.5% in the coming quarters.

At the same time the report also takes note that IMF is projecting 4% inflation growth for the year-end. Our view is also similar that we may see 4% or lower on the back of slowing growth.

Q: So no rate hike?

A: On this background, we do not expect any rate hike though the market is going with a 60-70% chance of a rate hike and so if our view comes true we can see a good rally in the market

Q: If there is a rate hike where do you see the 10-year and if there isn’t where do you see it?

A: If there is no rate hike we can see 10-year going to 8% but if there a hike then 10-year can go to 8.25% but it will be good levels to invest, so either hike or no hike one want be wrong if one is long with the bonds. Our year-end projection is of 7.5% on 10-year with slower growth.