Internal debt constituted 91.1% of public debt and marketable securities accounted for 83.3% of total public debt
The Finance Ministry in its quarterly report on debt management has mentioned that the gross and net market borrowings were higher than previous year by 1.0% and 0.2%, respectively in FY2014. Auctions during Q4 of FY14 were held in accordance with the pre-announced calendar apart from the cancellation of one deferred auction of Rs 15000 crore scheduled on 17 January 2013.The weighted average maturity and weighted average yield (cut-off) of dated securities issued during Q4 of FY14 remained stable at 13.77 years (13.91 years in the previous quarter) and 9.07% (8.93% in Q3) respectively.
Weighted average yield of issuance during FY14 at 8.41% was marginally higher than 8.36% in the previous fiscal year, while weighted average maturity at 14.23 years was higher than 13.5 years in FY13. The cash position of the Government during Q4 was comfortable and remained in surplus mode during the quarter.
As budgeted in Union Budget 2013-14, the Government repurchased its Securities through reverse auction for an aggregate amount of Rs 15,590 crore (face value) during March 2014 to prematurely redeem the Government Stocks by utilizing its surplus cash balances. In addition switching of government securities worth Rs 31,400 crore from 2014-15 and 2015-16 maturity buckets to longer tenors was also conducted in fourth quarter.
The total public debt (excluding liabilities under the 'Public Account') of the Government at end-March 2014 decreased marginally on a quarter-on-quarter (qoq) basis by 0.1% (provisional) compared with an increase of 3.1% in the previous quarter. Internal debt constituted 91.1% of public debt and marketable securities accounted for 83.3% of total public debt. About 29.8% of outstanding dated securities have a residual maturity of up to 5 years compared with about 30.2% a quarter ago which implies that over the next five years, on an average, less than 6.0% of outstanding stock needs to be rolled over every year.
In the secondary market, while there was no change in closing levels of 10 year bench mark Government of India security at end-quarter from previous quarter end (8.84 % on 31 March 2014), the yield traded in a range of 8.52% - 8.94% during Q4 of FY 14. Compared to previous quarter, bonds yields marginally moderated over the curve with marginally flattening at the longer end while some steepening in maturities below 10 years. The total volume of Government securities transacted on an outright basis increased by 18.32% over the preceding quarter, contributed mainly by Central government dated securities. The annualized outright turnover ratio for Central government dated securities for Q4 of FY14 increased to 3.65 from 3.10 during the previous quarter.
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