India Bond Yields Steady On Lack Of Fresh Triggers
Wednesday,
20-Jan-2021
01:16 PM (IST)
India's federal government bond yields stayed largely unchanged in the afternoon session as investors awaited fresh cues. The benchmark 5.77% bond maturing in 2030 changed hands at 98.76 rupees, yielding 5.94%, at 1:00 p.m. in Mumbai, against 98.79 rupees, yielding 5.94% yesterday. The Indian rupee was at 73.10 to the dollar against 73.17 yesterday. India's central bank will buy federal government debt, which includes the benchmark note, worth 100 billion rupees tomorrow. This will be the first direct note purchase in nearly three months. India is likely to aim for an elevated budget deficit in the next financial year as it will continue to support the pandemic-hit economy, Nomura said today. The brokerage pegs the fiscal deficit target at 5.3% of GDP, against an estimated 6.8% of GDP for the current financial year that ends Mar. 31. India is due to present its budget for the next financial year on Feb. 1. It had targeted a fiscal deficit at 3.5% of GDP this year. The country’s economy is expected to face its deepest-ever contraction this year. New Delhi’s gross market borrowing could be pegged at around 11 trillion rupees ($15.03 billion) for the next fiscal year, a little off the record 12 trillion rupees this year, Nomura said. Crude oil prices rose on hopes of a massive stimulus in the U.S. as Democrat Joe Biden is due to take oath as the president of the world’s largest economy. The benchmark Brent crude oil contract was 0.8% higher at $56.33 per barrel. India imports nearly 85% of its crude oil requirement.
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