Refusing to yield.

India's consumer price index (CPI) inflation rate came in at 1.3% in December. "The latest inflation reading also means that quarterly inflation in the period ending December 2025, was 0.76%," because food prices contracted for the seventh consecutive month by 2.7% in December. "RBI's (Reserve Bank of India) December MPC (Monetary Policy Committee) resolution expects quarterly inflation for the periods ending March 2026 at 2.9%, 3.9%, 3.9% and 4% respectively." HT. These figures are well within the government's mandate of targeting CPI inflation rate of 4% with a margin of 2% on either side till March 2026. ET. In its December meeting, the MPC cut its policy rate by 25 basis points to 5.25% (DD News) to stimulate even faster economic growth. "The 10-year government bond yield is a benchmark that determines the interest- rate environment in the debt market." "Since June, its yield has stubbornly stayed in a 6.40-6.60% range." Despite the RBI "lowering its repo rate, which ought to have pulled down bond yields." G-secs set the benchmark for all bonds and so, "States lament that their cost of borrowing has gone up. Corporates too have to pay higher rates, even as bank loans have gotten cheaper," wrote Madan Sabnavis. Cutting interest rates is meant to make borrowing easier which should encourage companies to invest in new projects, thus increasing employment and boosting economic growth. The problem is that the RBI sells dollars to stop the rupee from devaluing precipitously against the dollar, which creates a shortage of the currency in the markets pushing up lending rates. In October, the rupee appreciated 0.8% in one day due to heavy dollar selling by the RBI. ET. "In June, the central bank announced a phased 100-basis-points CRR cut from September to November to release about 2.5 trillion rupees ($28.3 billion)." Reuters. The CRR or Cash Reserve Ratio "is a fixed percentage of a bank's total deposits that must be kept in cash with the RBI. This reserve cannot be used by banks for giving loans or making investments." Bajaj Finserve. The CRR is, therefore, meant to protect depositors against bank defaults who are insured for a derisory Rs 500,000, regardless of the amount of their precious savings they have entrusted to the banks (rbi.org.in). With the rupee trading at 90.31 to one dollar (xe.com), and with no end in sight for its plunge, the insured amount of Rs 500,000 looks increasingly worthless. With the government and the nation's central bank colluding to confiscate citizens' wealth it is no wonder that "Deposits fell by 8.97% to Rs 12.54 trillion in the financial year ending 2025." On the other hand, "Equity investments zoomed by almost 153%, reports Businessline. Mutual funds inflows nearly doubled, as they jumped 95% over the year." The Wire. Markets may fall, but that is preferable to a forcible loot. The bond market is refusing to yield. Will that protect us?