Copyright thehindubusinessline
Apropos ‘Why are 10-year bond yields sticky downwards?’ (October 27), the market’s unwillingness to let yields ease reveals a crisis not of liquidity, but of confidence. Despite the RBI’s steady efforts through rate cuts, CRR reductions, and ample liquidity injections, the bond market remains sceptical. Investors are clearly looking beyond policy gestures. Banks, though awash with funds, have been slow to transmit lower rates, constrained by weak credit demand and balance-sheet caution. This has created a policy paradox — where monetary easing coexists with fiscal anxiety. The stubborn yields reflect not defiance, but doubt — in growth revival, fiscal discipline, and global stability. Until the government’s fiscal stance reinforces the RBI’s monetary intent, yields will remain stuck in this uneasy middle ground. Salary negotiations This refers to ‘Exit dialogue: What would you consider a decent severance pay?’ (October 27). Employers across the world are waking up to the reality that employees are not just commodities to be purchased in a buyer’s market. Job interviews are transforming into dialogues between two parties, one interested in forward purchase of skills, and the other trying to bargain the best possible price for being hired long term. It’s heartening to see that present day candidates know their worth and are able to sell their skills at market-related price. Municipal bonds This refers to ‘Municipal bonds eligible for repo and reverse repo deals’ (October 27). The support by the government to enhance the institutional investment scope in this category of bonds is timely, since the majority of the urban local bodies are struggling to raise long term resources to meet the mounting capital and infra expenditure requirements. Though the listing of these bonds has been permitted earlier, there is not much trading reported in the securities, owing to the liquidity risk involved, in spite of the safety net provided in the form of sovereign guarantees by the States and prevailing incentive schemes. The new norms are likely to de-risk such issues. However, the listing guidelines mandates good credit rating of the bond issues and the majority of the corporations would fail to achieve this benchmark. To establish a healthy municipal bond ecosystem, the administration and management of ULBs are streamlined and they are to be secluded from political controls. Sitaram Popuri Published on October 27, 2025
