RBI rate hikes: How to protect your debt portfolio

What happened: The RBI raised its benchmark repo rate by 25 basis points to 5.5% and shifted its stance from "neutral" to "calibrated tightening," its first hawkish shift in close to four years, joining other central banks tightening policy. Key numbers: Repo rate up 25 bps to 5.5%; current cycle started at 5.25% versus 4% in 2022; 10-year bond yield rose from 7.2% to 7.4%; Why it matters: Bond market sentiment has soured since the stance shift, and experts see a shallow cycle, with the RBI indicating rate cuts are off the table near term and policy action can only be a hike or a pause.

The RBI raised its benchmark repo rate by 25 basis points to 5.5% and shifted its stance from "neutral" to "calibrated tightening," its first hawkish shift in close to four years, joining other central banks tightening policy.

Bond market sentiment has soured since the stance shift, and experts see a shallow cycle, with the RBI indicating rate cuts are off the table near term and policy action can only be a hike or a pause.