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Morgan Stanley Like Receiving 1y1y In India

ASIA RATES

Morgan Stanley recommend receiving 1y1y in India as "the market is expecting an 18bp hike in December and 25bp hikes in each of the six meetings in 2022. Should the RBI deliver a dovish hike, the market should rally. In addition, the government recently announced a tax cut to fuel prices, which should reduce some inflation pressure. Lastly, the government should continue to issue a very large size of IGBs to fund its deficit and aggressive rate hikes by the RBI would not help bond issuance."

  • They recommend entering the position at 5.46%, with a target of 5.10% and a stop at 5.65%.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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