Indian bond yields opened 2 basis points up on July 31 after the US President Donald Trump announced 25 percent tariffs and an additional penalty on India ahead of the August 1 deadline.
The 10-year benchmark bond yield opened at 6.391 percent, as compared to 6.370 percent at previous close.
On July 30, in a post on Truth Social, Trump described India as America's "friend" but added that it will face 25 percent tariffs plus a penalty for buying Russian military equipment and oil. Trump reiterated that India has among the "highest tariffs in the world".
"Remember, while India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country," Trump said on his social media platform.
Trump hit out at India and China for dealing with Moscow at a time when "everyone wants Russia" to stop the war in Ukraine.
Moreover, US Federal Reserve's Federal Open Market Committee (FOMC) decided to keep interest rates unchanged at 4.25 percent to 4.5 percent in the July 29-30 meeting, with two members dissenting with calls for 25 basis points cut. FOMC saw its first double dissent since 1993.
Top Federal Reserve officials, Vice Chair for Supervision Michelle W. Bowman and Governor Christopher J. Waller, voted for a rate cut, while 9 other members, including Federal Reserve Chair Jerome Powell, voted to keep the key lending rate steady.
The marks the first time that two of the seven Federal Reserve governors have dissented from the majority's decision since 1993. Experts were expecting the governors to dissent ahead of the FOMC meeting, as both Waller and Bowman had been outspoken on their opinion regarding the interest rate cuts.
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