Indian bonds saw fluctuations due to rising US treasury yields, drawing focus to the upcoming RBI, India’s central bank, policy meeting. After initial trades, 10Y yields settled at 7.20%. HSBC’s lead economist suggests the RBI should retain current rates but adopt a hawkish stance, influenced by robust urban growth. Nonetheless, rising food prices may push the CPI inflation forecast for FY24 to around 5.3%-5.4%. The market anticipates a hawkish pause, closely observing RBI’s stance on food prices and broader inflation implications. A decrease in core CPI and favorable monsoon patterns suggest potential moderation in food prices.