Bullish govt bonds reflect slowdown in global and domestic economies

While government bonds have rallied in the recent past on domestic rate cut expectations and comfortable liquidity, the rupee has remained relatively choppy. The currency is mirroring the equity market, reflecting a slowdown in the global and domestic economies.
 
Indeed, global bond yields have fallen quite substantially, with some in Europe hitting sub-zero levels, an early sign of a global slowdown. Investors rush to buy fixed income investment during uncertain times. As yields fall, prices of bonds rise.
 
The yields on the 10-year bond fell to a 31-month low on Tuesday, and closed at almost same level at