Bond Markets Don’t Lie - They Tell You the Truth About the Economy . Indian Market , December 2025
Bond Markets Don’t Lie They Tell You the Truth About the Economy When the RBI cuts rates, most people look at equity markets for clues. 👉But the real story The honest, unfiltered, short-term reality of the economy is always shows up in the bond market first. 👉And right now! Bond yields are not impressed. Why? 👉RBI neutral stance signals policy pause. 👉Slowing Nominal GDP Slower nominal GDP doesn’t create inflation, but it creates fiscal pressure. With revenue growth cooling, the government must borrow more, and higher bond supply keeps yields elevated. 👉Global rates still matter more than we admit. India cannot run a fully independent monetary policy. With US yields still elevated, spreads at historic lows, and global liquidity tight, Indian yields cannot collapse simply because the repo rate is cut. 👉Heavy government borrowing is expected in coming months. Lower nominal GDP → lower revenue growth → higher fiscal pressure. More government bond supply → lower pric...