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Time of India
30-05-2025
- Business
- Time of India
RBI's bond buyback, economic growth push yields higher amid rate cut hopes
Yields of the 10-year benchmark climbed four basis points higher at 6.29%, as traders increased bets on a shallower rate easing cycle after Friday's data showed the economy expanded 6.5% for FY25. Many traders now believe the terminal policy rates would be higher - at 5.50%-5.75%. Soon after trading ended, the Reserve Bank of India (RBI) also announced Rs 25, 000 crore of bond buybacks - a measure aimed at infusing durable liquidity in the system. A section of money market traders had factored a terminal policy rate of 5% - 5.25% on expectation that GDP would grow at 6.3%. The repo rate, currently at 6%, is widely expected to be reduced by another 25 basis points to 5.75% in the monetary policy announcement on June 6. Yields of the 10 year bond traded in a five basis point range of 6.24% to 6.29%, with a sharp rise seen in the last half hour of the trade, CCIL data showed. The yield had closed at 6.25% on Thursday. Live Events 'There was a section of the market who anticipated terminal rates at 5% to 5.25%, but with the latest GDP data, the cumulative cut expectations by the RBI has come down. Hence some bonds got sold off, taking yields higher towards the end,' said a senior bond trader at a primary dealership. Traders expect yields to ease next week though, in the run up to the RBI's monetary policy announcement on June 6. The RBI is expected to cut rates by 25 basis points for the third consecutive time. Additionally, the RBI also announced buyback of government bonds worth Rs 25,000 crores on June 5, with an aim to infuse liquidity, and also take down the redemption cost for FY 27. All the bonds that RBI will buy back on June 5 will mature in FY 27.
Economic Times
14-05-2025
- Business
- Economic Times
Rupee steady at 85.33/$ amid oil demand, trade optimism
Mumbai: The Indian rupee ended nearly unchanged from its previous close at 85.33 per dollar on Tuesday, after touching a peak of 84.63 during the day. The rupee gave up its gains amid dollar buying from oil companies, foreign investors and state-run banks, traders said. ADVERTISEMENT The rupee opened at 84.70/$1 versus 85.37 per dollar close on the previous day (Friday). The initial optimism seen in the rupee on Tuesday came on the back of US-China trade agreement and a ceasefire agreement between India and Pakistan. "A key question is what this trade deal means and where Asian currencies will stand relative to China," said MUFG Bank in a note. "This is perhaps most relevant for the likes of India, Malaysia, Vietnam and Thailand, which are most likely to be able to substitute China's exports, and where there are moves to try to strike a trade deal with the US, most notably for India and Vietnam." During the closing hours, the dollar index was at 101.6, while US treasury bill yields dipped to 4.5%.Brent crude oil on the other hand rose to $65.25 per barrel from $60 per barrel seen last week, in response to the US-China trade deal. Rising oil prices is seen as a negative factor for the economy as India is a major importer of the commodity. ADVERTISEMENT Separately, yield on the government bond maturing in 2034 (old benchmark) ended at 6.32%, down 5 basis points from the previous close of 6.37%, while the yield on the new 10-year benchmark bond maturing in 2035, ended at 6.27%, CCIL data showed. Bond yields fell sharply in the last hour of the trade, after consumer price index (CPI) data for the month of April was released. ADVERTISEMENT "The fall in yields at the end of day was because of better than expected inflation numbers," said a bond trader at a primary dealership. India's retail inflation remained below the central bank's 4% target for the third consecutive month at 3.16%, as food prices rose at a slower pace. (You can now subscribe to our ETMarkets WhatsApp channel)
Time of India
14-05-2025
- Business
- Time of India
Rupee steady at 85.33/$ amid oil demand, trade optimism
Agencies Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Mumbai: The Indian rupee ended nearly unchanged from its previous close at 85.33 per dollar on Tuesday, after touching a peak of 84.63 during the day. The rupee gave up its gains amid dollar buying from oil companies, foreign investors and state-run banks, traders rupee opened at 84.70/$1 versus 85.37 per dollar close on the previous day (Friday). The initial optimism seen in the rupee on Tuesday came on the back of US-China trade agreement and a ceasefire agreement between India and Pakistan."A key question is what this trade deal means and where Asian currencies will stand relative to China," said MUFG Bank in a note. "This is perhaps most relevant for the likes of India, Malaysia, Vietnam and Thailand, which are most likely to be able to substitute China's exports, and where there are moves to try to strike a trade deal with the US, most notably for India and Vietnam."During the closing hours, the dollar index was at 101.6, while US treasury bill yields dipped to 4.5%.Brent crude oil on the other hand rose to $65.25 per barrel from $60 per barrel seen last week, in response to the US-China trade oil prices is seen as a negative factor for the economy as India is a major importer of the yield on the government bond maturing in 2034 (old benchmark) ended at 6.32%, down 5 basis points from the previous close of 6.37%, while the yield on the new 10-year benchmark bond maturing in 2035, ended at 6.27%, CCIL data yields fell sharply in the last hour of the trade, after consumer price index (CPI) data for the month of April was released."The fall in yields at the end of day was because of better than expected inflation numbers," said a bond trader at a primary retail inflation remained below the central bank's 4% target for the third consecutive month at 3.16%, as food prices rose at a slower pace.
Time of India
01-05-2025
- Business
- Time of India
Overseas investors pull Rs 13,359 crore from Indian bonds amid US yield surge and geopolitical tensions
Mumbai: Net sales of Indian bonds by overseas investors surged the highest in April since the inclusion of local debt on global bond indices, reflecting the undiminished allure of higher returns in the US, and the impact of escalating tensions with Pakistan toward the latter half of the month, market experts said. Reversing four months of inflows, April saw a net ₹13,359 crore of outflow from the index-eligible fully accessible route (FAR) government securities, the highest monthly exit since India's inclusion in the JP Morgan EM index in July 2024, CCIL data showed. Passive investments often closely track the weightings on global gauges. Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Play this game for 1 minute and see why everyone is addicted. Undo "In the first half of this month, dollar yields were volatile amid speculation about the potential dismissal of the Fed chair and retaliatory tariffs, leading to the expectations that dollar yields could skyrocket," said Nitin Agarwal, head of trading at ANZ Banking Group. "The second half of the month has been dominated by escalating geopolitical tensions , prompting investors to go bearish on Indian bonds." Play Video Pause Skip Backward Skip Forward Unmute Current Time 0:00 / Duration 0:00 Loaded : 0% 0:00 Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 1x Playback Rate Chapters Chapters Descriptions descriptions off , selected Captions captions settings , opens captions settings dialog captions off , selected Audio Track default , selected Picture-in-Picture Fullscreen This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Text Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Transparent Caption Area Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Drop shadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Bonds Corner Powered By Overseas investors pull Rs 13,359 crore from Indian bonds amid US yield surge and geopolitical tensions Reversing four months of inflows, April saw a net ₹13,359 crore of outflow from the index-eligible fully accessible route (FAR) government securities, the highest monthly exit since India's inclusion in the JP Morgan EM index in July 2024, CCIL data showed. Passive investments often closely track the weightings on global gauges. Bond Market sees demand surge as RBI's Rs 1.25 Lakh crore OMO plan spurs premium pricing RBI gets nearly double the bids in Rs 20,000-cr market purchase After yield surge, US Treasury expected to keep auction sizes steady Indian bond yields rise on anticipation of new 10-year issuance, position unwinding Browse all Bonds News with Local bonds are now part of three global indices-the JP Morgan emerging market index, the FTSE Russell index, and the Bloomberg Emerging Market local currency government index. Flows had turned negative in October and November last year, before picking up again. Live Events The net cumulative flow under the FAR route was ₹8,919 crore from July 2024 to April 2025. Over the same period, the investment in equities via the FII route saw outflows worth ₹1,15,125 crore, according to NSDL data. Around mid-April, yields on the 10-year US treasury bill shot up to 4.5%, within just a few days, from 3.9% on April 10, while the 30-year yield spiked at almost 5%, London Stock Exchange Group data showed. In contrast, Indian bond yields have trended lower despite geopolitical concerns, narrowing the difference with the US yields. The benchmark 10-year yield has dropped to 6.36% as of April 30, from 6.53% on April 2, CCIL data showed. Agencies Stability Hunt "At the end of the day, emerging markets like India thrive in periods of stability, which has not been the case lately," Agarwal said. Global funds are underweight on Indian bonds even as Indian debt reached their full 10% weight in the JP Morgan EM index in April. "In terms of the weights on the JP Morgan index, we are at 10%. But there are some funds who are not at that 10% weight, partly because of operational reasons and partly because they may be slow to build their India positions," saif Nathan Sribalasundaram, Asia EM rates strategist, Nomura. Along with the requirement of margins to be posted and extension of trading hours, the fund registration also remains a cumbersome process, Nick Gendron, global head, fixed income index product, Bloomberg Index Services had told ET in January.
Economic Times
01-05-2025
- Business
- Economic Times
Overseas investors pull Rs 13,359 crore from Indian bonds amid US yield surge and geopolitical tensions
Mumbai: Net sales of Indian bonds by overseas investors surged the highest in April since the inclusion of local debt on global bond indices, reflecting the undiminished allure of higher returns in the US, and the impact of escalating tensions with Pakistan toward the latter half of the month, market experts said. ADVERTISEMENT Reversing four months of inflows, April saw a net ₹13,359 crore of outflow from the index-eligible fully accessible route (FAR) government securities, the highest monthly exit since India's inclusion in the JP Morgan EM index in July 2024, CCIL data showed. Passive investments often closely track the weightings on global gauges. "In the first half of this month, dollar yields were volatile amid speculation about the potential dismissal of the Fed chair and retaliatory tariffs, leading to the expectations that dollar yields could skyrocket," said Nitin Agarwal, head of trading at ANZ Banking Group. "The second half of the month has been dominated by escalating geopolitical tensions, prompting investors to go bearish on Indian bonds." Local bonds are now part of three global indices-the JP Morgan emerging market index, the FTSE Russell index, and the Bloomberg Emerging Market local currency government had turned negative in October and November last year, before picking up net cumulative flow under the FAR route was ₹8,919 crore from July 2024 to April 2025. Over the same period, the investment in equities via the FII route saw outflows worth ₹1,15,125 crore, according to NSDL data. ADVERTISEMENT Around mid-April, yields on the 10-year US treasury bill shot up to 4.5%, within just a few days, from 3.9% on April 10, while the 30-year yield spiked at almost 5%, London Stock Exchange Group data contrast, Indian bond yields have trended lower despite geopolitical concerns, narrowing the difference with the US yields. ADVERTISEMENT The benchmark 10-year yield has dropped to 6.36% as of April 30, from 6.53% on April 2, CCIL data showed. Stability Hunt ADVERTISEMENT "At the end of the day, emerging markets like India thrive in periods of stability, which has not been the case lately," Agarwal funds are underweight on Indian bonds even as Indian debt reached their full 10% weight in the JP Morgan EM index in April. "In terms of the weights on the JP Morgan index, we are at 10%. But there are some funds who are not at that 10% weight, partly because of operational reasons and partly because they may be slow to build their India positions," saif Nathan Sribalasundaram, Asia EM rates strategist, Nomura. ADVERTISEMENT Along with the requirement of margins to be posted and extension of trading hours, the fund registration also remains a cumbersome process, Nick Gendron, global head, fixed income index product, Bloomberg Index Services had told ET in January. (You can now subscribe to our ETMarkets WhatsApp channel)
