Room for RBI to respond to global growth drag

While the growth-inflation trade-off emanating from the tariff impacts is somewhat tricky for the US, it is relatively clearer for India as inflation is under control, according to SUYASH CHOUDHARY, head-fixed income, Bandhan AMC. In an email interview with Abhishek Kumar, Choudhary says expectations of resilient economic growth and fiscal discipline make Indian government bonds appealing. Edited excerpts:

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India's debt market has largely remained insulated from global trade tensions. What are the reasons and can it sustain? The weakening of the dollar reflects some unwinding of the so-called "US exceptionalism" theme, which had attracted disproportionately large allocations to dollar assets over the years. This is good news for India and other emerging markets, as it has reduced pressure on local currencies.

As a result, the Reserve Bank of India (RBI) now has a greater degree of independence in conducting monetary policy.