RBI completes auction for new 10-year government security
The Reserve Bank of India raised Rs 34,000 crore via a new 10-year government bond at a 6.94% cut-off yield, in line with expectations. Strong demand saw bids cross Rs 1 lakh crore. The new security will become the benchmark, influencing corporate...
By Atmadip Ray, ET Bureau |
ANI
The Reserve Bank of India on Friday successfully completed the auction for a new 10-year government security, selling the full notified amount of Rs 34000 crore at 6.94% cut-off yield.
The cut-off yield was in line with market expectation. Traders were expecting it 2 basis points lower than the market rate on the prevailing benchmark paper.
The benchmark 6.48% 2035 bond yield was seen at 6.9659% in the morning after closing at 6.9328% on Thursday. Yield moves inversely to bond price.
The new paper will become the new benchmark and set a floor for corporate borrowing. All corporate bonds are typically benchmarked to the 10-year yield.
Friday's auction saw saw strong demand, with total bids received for ₹1.02 lakh crore, data from RBI showed.
The cut-off yield was in line with market expectation. Traders were expecting it 2 basis points lower than the market rate on the prevailing benchmark paper.
The benchmark 6.48% 2035 bond yield was seen at 6.9659% in the morning after closing at 6.9328% on Thursday. Yield moves inversely to bond price.
The new paper will become the new benchmark and set a floor for corporate borrowing. All corporate bonds are typically benchmarked to the 10-year yield.
Friday's auction saw saw strong demand, with total bids received for ₹1.02 lakh crore, data from RBI showed.
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