Economy News

States borrow record Rs 32,800 crore, cost jumps 7 basis points to 7.68pc – Mintpaisa

Despite nearly 60% more supplies, states continued to pay more for market borrowing, with the average bond price rising 7 basis points to a multi-week high of 7.68% during the stock market. weekly auction on Tuesday. For several weeks, yields have more or less stagnated, as have debt raisings.

Fourteen states raised a record amount of Rs 32,800 crore in the market by issuing government securities (SGS), which is 59% higher than last year’s level, although the amount is lower by 8% to that indicated in the auction calendar, said Aditi Nayar, chief economist and head of research at Icra Ratings in a briefing note.

She said the 7 basis point rise in the weighted average threshold to 7.68% was due to monetary tightening concerns, as the latest inflation data surprised on the downside.

However, despite the record level of borrowing and a slight increase in the weighted average duration to 16 years from 15 years, the spread between the 10-year SGS and the yield fell to 29 basis points from 31 basis points the last week, she said.


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