Context:
The yield spread between India’s 3-year and 10-year government bonds has widened to 48 basis points (bps) in FY26, up from 15 bps at the start of the fiscal and just 4 bps in January 2025. This reflects the RBI’s monetary easing, liquidity infusion, and a 100 bps CRR cut.
Key Highlights:
- Latest Bond Yields:
- 3-year G-sec: 5.83%
- 10-year G-sec (benchmark): 6.31%
- Yield spread: 48 bps (up 12x in CY25)
About Government Bonds
Government Securities (G-Secs) are sovereign debt instruments issued by the RBI on behalf of the Government of India.
- Short-term G-Secs: <5 years maturity
- Long-term G-Secs: Typically 10 years or more
- Used to fund fiscal deficits and manage public debt
