All engines of equity valuations firing (growth, ERP and RF), may spur risky behaviour typical of a bull market
From a peak of ~7.6% in Jun’22, the 10-year bond yield (RF - risk free rate) has dipped to sub 7% currently as the aggressive interest rate tightening cycle peaked. ERP (equity risk premium) indicators for India have also dipped significantly over the past one year in the form of: (a) Sharp decline in CDS of India 10-year bond from 230bps to ~150bps currently.