DBS expects RBI to gradually lower rates

DBS expects RBI to gradually lower rates at a pace of 25 bps per quarter, forecasting that demand pressures behind inflation are easing considerably.

"The combination of high yields, a downward sloping forward path for policy rates and the prospect of more currency stability should see foreign interest in the gilt market remaining strong," DBS writes.

RBI's proposed loan recast norms decoded; impact on banks

That's a contrast to Asia, where the prospects of stronger global economic growth and rising US Treasury yields are putting bearish steepening pressure on the short-ends of Asian yield curves, it adds.

Dealers welcome RBI's move to deepen corp bond mkts