The recent sell-off in US bonds kept markets across the world on edge. Speaking to CNBC-TV18, Jayesh Mehta, MD & Country Treasurer at Bank of America expressed concerns about the pace of rise in US yields, cautioning that it "could lead to another accident."

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Mehta said, “The way and the speed at which it has happened, so we saw one accident last year, or maybe six months back, and I wouldn't be surprised if we see something more happening in another six months or so because of the pace, and the way the rates have gone up. So that's is little bit challenging, we have to be careful. The global macro does not look that good as of right now.”

"Inflation is coming off in the US but don’t expect a cool-off," he cautioned.

“Even inflation temporarily may be coming off, but then it can sharply bounce off, there is no cool-off. So their economy is actually doing well. So that's the reality and we cannot ignore it. So from that perspective, it becomes very difficult, globally, because it's the Big Daddy anyway, so from that perspective, if that is surging, the rest of the people do suffer.”

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Mehta also shared his expectations on the Reserve Bank of India's monetary policy announcement scheduled for Friday, October 6. He expects RBI to maintain its current policy stance in the near term. “To just go with consensus and I personally also think, no action, no change in stance, no change in rate."

He said while the US has its own problems, our inflation is quite curtailed because of the dollar strengthening, and maybe to be a little more cautious, RBI may keep liquidity tight.

“Next year is going to be pretty volatile and more than our election, there is also an election in the US so let's not forget that," he said, adding, India looks good but if things are not stable globally, it will impact all emerging markets.

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(Edited by : Shweta Mungre)