“Neelkanth Mishra, Chief Economist, Axis Bank & Head Of Global Research, Axis Capital, notes that despite the Union Budget's predictability and fiscal discipline, which are positive for investors, these benefits are not translating into lower borrowing costs or bond yields. He attributes this to elevated government cash balances draining banking system liquidity, which pushes up funding costs for banks and prevents the transmission of fiscal discipline to lower rates. This ongoing lack of rate transmission is identified as the biggest challenge for the RBI and government in closing the output gap, suggesting continued pressure on bond yields and liquidity conditions.”