paragraph

(Reuters) - The spread between India's one-year and five-year overnight indexed swaps dropped to its lowest level in over 29 months on Tuesday as bets of aggressive rate hikes from the Reserve Bank of India ebbed.

The one-year swap rate was trading at 6.10%, while the five-year swap rate has fallen more to 6.24%, with the spread dropping to 14 basis points (bps), which is lowest since March 2020.

The spread had been above 50 bps at end of June, and had jumped to as high as 160 bps in April in anticipation of a prolonged rate hike cycle.

"The fact that the Federal Reserve may find it tough to raise rates aggressively is having a cascading effect across asset classes," trader with a private bank said.

The RBI monetary policy decision is due on Aug. 5, with views on the quantum of rate increase split between 25 basis points and 50 basis points, according to a Reuters poll of economists.

The RBI has hiked its repo rate by 90 bps since May.

"Markets have already factored in 35 basis points hike by the RBI on Friday, and expectations of not many hikes after this one has led to strong receiving interest in swaps, especially the five-year part," another trader said.

India's 1-5-year OIS spread drops to lowest in 29 months

The one-year swap rate was trading at 6.10%, while the five-year swap rate has fallen more to 6.24%, with the spread dropping to 14 basis points (bps), which is lowest since March 2020.

Australia's central bank raises rates 50 basis points to 1.85%

Markets edge lower to track broader market, Nifty at 17280

Oil prices fall as weak factory data fuels global demand concerns

Indian markets outperformed most global peers in July

Zomato shares jump 9% as losses ease in the June quarter

Rupee breaks below 79 per dollar, bond yield at 3-month low

Bond Market is Wrong on Fed’s Path, Economist Says

Markets sink as talk of Pelosi Taiwan trip fans China-US tension

Before Market Opens: 9 things to know at 9 am on August 2, 2022

From Nithin Kamath of Zerodha to Uday Kotak: Market experts mourn Rakesh Jhunjhunwala's demise

The 62-year-old Rakesh Jhunjhunwala passed away on Sunday morning in Mumbai.

How does an investor measure a mutual fund’s volatility? Things you need to know

Before you invest in a mutual fund, you should evaluate its performance based on its returns as well as on the consistency of these returns — something that can be measured by standard deviation. We share more details on this here.

Zero cost term plans: Getting insurance premium back in case of discontinuance

Under these term insurance plans; policyholder can discontinue paying premiums at a stage of life where they feel they don’t need an insurance any more

Rakesh Jhunjhunwala: What made the man so special

<ul><li>Rakesh Jhunjhunwala has left a legacy behind. A perpetual believer of India story, he was always bullish about the country because of the immense opportunities. He had also been vocal about the reforms initiated by the government which he believed will not only facilitate India's growth at present, but will open several new opportunities in future also.</li></ul>

Rakesh Jhunjhunwala, India's Warren Buffet, dies at 62

A chartered accountant by profession from the desert state of Rajasthan, Jhunjhunwala started dabbling in stocks while in college and went on to manage a stock trading firm, RARE Enterprises.