India’s fixed income market moved against expectations despite the RBI’ s recent dovish signals. The 10 year government bond yield rose to 6.85 percent on December 12 as foreign portfolio investors sold nearly $2.5 billion worth of Indian debt. The pressure spilled into currency markets, with the rupee weakening to 84.8 against the US dollar. Market participants say sustained bond outflows could limit the impact of future rate cuts on borrowing costs and financial conditions.