Rate-cut cycle likely over; RBI may begin hiking by FY27, says PGIM India
India's monetary policy rate-cut cycle is expected to end, with the RBI potentially beginning rate hikes of 50-75 basis points by fiscal year 2027, according to Puneet Pal, head of fixed income at PGIM India.
Pal attributed the anticipated shift to persistent inflation and elevated crude oil prices. He believes rising bond yields will create investment opportunities in high-quality corporate bonds and target-maturity funds, offering better returns for investors navigating the changing interest rate environment.
