Business Standard

RBI could be facing another standoff with traders over new bond sale

Central bank seeks to keep the government's borrowing costs low, while investors are demanding higher yields.

photo: Bloomberg
Premium

Photo: Bloomberg

Subhadip Sircar and Ronojoy Mazumdar | Bloomberg
The Reserve Bank of India is set for another standoff with traders as it auctions a new benchmark 10-year bond.
 
While the current benchmark coupon was set at 5.85%, five traders surveyed by Bloomberg expects the central bank to sell the new bond at a cutoff yield of 6.1% at Friday’s auction.

The RBI has been locked in a tussle with the bond market as it seeks to keep the government’s borrowing costs low, while investors are demanding higher yields because of rising inflation and supply concerns. Setting a lower coupon for the new 10-year bond may lead to a

What you get on BS Premium?

  • Unlock 30+ premium stories daily hand-picked by our editors, across devices on browser and app.
  • Pick your 5 favourite companies, get a daily email with all news updates on them.
  • Full access to our intuitive epaper - clip, save, share articles from any device; newspaper archives from 2006.
  • Preferential invites to Business Standard events.
  • Curated newsletters on markets, personal finance, policy & politics, start-ups, technology, and more.
VIEW ALL FAQs

Need More Information - write to us at assist@bsmail.in