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The 10-year bond yield in India hit a nine-month low on Thursday, propelled by a fall in US peers. The yield on the 10-year benchmark bond dropped to 6.20%, its lowest level since February, as investors flocked to safer assets amid growing concerns about the global economic outlook.

The decline in the bond yield came as US Treasury yields fell sharply, with the benchmark 10-year Treasury yield dropping to 1.25% on Wednesday, its lowest level since February. The fall in US yields was driven by fears of a slowdown in the global economy, as well as concerns about the spread of the Delta variant of the coronavirus.

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Investors in India reacted to the drop in US yields by buying up government bonds, pushing their prices higher and yields lower. The fall in bond yields is good news for the Indian government, which has been facing pressure to rein in its soaring borrowing costs. Lower bond yields make it cheaper for the government to borrow money, which could help ease the pressure on its finances.

Analysts say that the fall in bond yields is also a sign of improving sentiment in the Indian economy. The Reserve Bank of India has maintained an accommodative stance on monetary policy, and the central bank has been taking steps to support economic growth in the face of the COVID-19 pandemic.

The fall in bond yields could also be seen as a vote of confidence in the Indian government’s handling of the economy. Despite facing significant challenges, including a second wave of COVID-19 infections earlier this year, the government has managed to keep the economy on track and is now focused on boosting growth and creating jobs.

Overall, the fall in India’s 10-year bond yield to a nine-month low is a positive sign for the economy and the government. It reflects investor confidence in India’s economic prospects and could help support growth in the coming months. But, as always, investors will be watching closely for any signs of trouble on the horizon, including developments in the global economy and the ongoing pandemic.

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