Gsec yield curve may flatten in FY27

The government bond yield curve is likely to flatten in the financial year 2027 (FY27) as the Reserve Bank of India (RBI) is expected to ease supply pressure in the ultra-long segment.Illustration: Dominic Xavier/RediffIn FY26 so far, reduced investments by insurance companies and pension funds pushed up yields on ultra-long tenor securities, steepening the curve.A recalibration of issuance, however, could help normalise yields at the long end in the coming year, experts said. “The upward pressure on ultra- ...