The global equity, commodity market markets witnessed the a very steep fall followed by bank failures which resulted in global credit and liquidity crises which led the risk of recession to global economies and therefore forced the major central banks across the globe to ease rates and infuse cheap liquidity in an unprecedented manner. The global phenomena casted a shadow on Indian financial markets leading to a liquidity and credit crunch.  As the inflation started falling and there was threat of a massive slowdown to the Indian economy the Indian central bank also decided to cut rates and CRR to infuse cheap liquidity in an unprecedented fashion. There has been a sharp decline in 10 yr g sec on back of SLR demand and flight to safety 10yr G sec has come down to 5.50% from a high of 9.50% and is expected to trade in the band of 5.5% on the upside and 4.75% on the low side a breach of level on either side will be very significant. With liquidity remaining easy and the RBI was on a rate-cutting mode, the 10-year AAA credit spreads have narrowed to around 300 Bps from 450 Bps.  We expect the credit spread to narrow down on the AAA credit curve over 6 months time as the RBI has changed the stance and we expect a sharp decline in WPI on the back of falling commodity and crude oil prices, therefore investors could look at investing in bonds funds with a investment horizon of minimum 6 months.