G-Secs

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'The launch of a mobile app for accessing the Retail Direct portal will provide greater convenience to retail investors and deepen the G-sec market,' said the RBI Governor

Sitharaman lauded the RBI's resilience and leadership among its central bank counterparts, emphasizing its crucial role in maintaining financial stability

At the first weekly auction of the last quarter of 2023-24, the states saw their interest burden sharply rising to cross the 7.7 percentage mark on Tuesday, leading to the spread between the cut-off of 10-year state bonds and the G-sec yield crossing the 50 basis points mark for the first time in two years. At 53 basis points, the spread between the yield on the sovereign debt and that of the state bonds is the highest since January 2022. According to Aditi Nayar, the chief economist at Icra Ratings, both coupons at 7.71 per cent and the spread jumped to record levels due to the concerns of large supply in the final quarter of the fiscal year. At the maiden auction of the fourth quarter, six states collectively raised Rs 16,000 crore through state government securities (SGS) which is 19 per cent on-year higher, and in line with the amount indicated for the week in the Q4 auction calendar. Taking a cue from the all-time high indicative borrowing of Rs 4.1 lakh crore in the final ...

The Association of Mutual Funds of India (AMFI) on Friday welcomed the decision of global financial major JP Morgan to include government bonds in its benchmark Emerging Market Index from next year, saying it will result in more demand for government securities. It will help bring over USD 30 billion into government bonds or government securities (G-Sec), AMFI Chief Executive NS Venkatesh said. "We welcome the decision. This will increase the demand for government bonds resulting in the yields coming down. The forex inflow of over USD 30 billion will result in strengthening of Indian Rupee," he told PTI. The inclusion of IGBs will be staggered over a 10-month period from June 28, 2024, to March 31, 2025, with a one per cent increment on its index weight each month. "India's weight is expected to reach the maximum weight threshold of 10 per cent in the GBI-EM Global Diversified, and approximately 8.7 per cent in the GBI-EM Global index," JP Morgan said in a statement. Gilt funds ar

Analysts expect the Wall Street major JP Morgan's decision to include the Indian government bonds in its global index from June next year will lead to a direct inflow of USD 20-25 billion in the country's debt market over 18-21 months. JP Morgan, announcing the inclusion earlier in the day, said India will have a maximum weight of 10 per cent in the index eventually and around 8.7 per cent in the emerging market global index. JP Morgan said in a statement on Friday that 73 per cent of investors are in favour the decision. The inclusion will be staggered over a 10-month period from June 28, 2024 to March 31, 2025. "We estimate this implies direct inflows of USD 20-25 billion over the course of the next 18-21 months, but some front-loading of inflows cannot be discounted," Rahul Bajoria, managing director and head of emerging market Asia (ex-China) at Barclays, said in a note on Friday. Japanese brokerage Nomura has pegged the inflows at USD 23.6 billion, which is 10 per cent of the

The rupee could continue to see near-term volatility

A recent analysis by CLSA shows that "most of Nifty's tops have been at the 2-ppt bond yield-equity yield level"

Invest in individual bonds only if you can analyse and monitor the credit profile of companies

Shields banks from adverse impact from bond portfolio

Constitution of underlying indexes doesn't matter since all the three categories of bonds they invest in are safe

The borrowing cost of states continued to remain low for the second week with the latest auction on Tuesday seeing average yield staying almost flat at 7.68 per cent. Many states stayed away from the market following disbursal of the tax devolution amount by the Centre earlier this month. The weighted average yield/cut-off of State Government Securities (SGS) inched up by 1 basis point to 7.68 per cent at the auction on Tuesday compared to the past week despite a sharp increase in the weighted average tenor to 17 years from 12 years, Icra chief economist Aditi Nayar said in a note. Normally bond prices change according to the tenor of the issue, and the 10-year bonds are considered the benchmark when it comes to pricing and also from a demand perspective. At Tuesday's auction, the states issued bonds of varying tenor, peaking at 25 years (Tamil Nadu issued 25-year paper at 7.63 per cent) pushing up the median average tenor sharply to 17 years from 12 years last week. However, the

Banks expressed concerns about trade impact, disruptions seen in OIS, bond markets

The Deputy Governor flagged instances of wild swings in sovereign bond yields in response to factors such as the announcement of the government's borrowing programme and interest rate changes

Since this is a nascent category to invest, there could be liquidity risk

Check the return for your age, tenure, and premium variant, and if proceeds will be tax-free

Those keen on locking in interest rates for very long tenures should also opt for them

The IPO-bound national insurer LIC is not only the largest holder of government debt -- owning 19 per cent of the G-secs -- but also the single largest owner of equities

During H1, banks were investing in G-secs and are not under stress due to rising yield

Stick to shorter tenure fixed deposits now to benefit from higher rates later