Indian bonds steady as RBI sticks to less-traded assets
Indian government bonds stayed steady on Wednesday, with the 10-year yield at 6.61%.
The Reserve Bank of India (RBI) is mostly buying less-traded, or "illiquid," bonds—so hopes for big moves in more popular ones are low.
Even after snapping up ₹50,000 crore in bonds this week (and planning to double that soon), the market hasn't really budged and supply worries remain.
Why it matters: supply crunch and possible global boost
Bond supply could top ₹8 trillion by March, making investors a bit uneasy.
State banks are still favoring state-issued bonds over central ones, which keeps yields higher.
Upasna Bhardwaj from Kotak Mahindra Bank points out that more interest from pensions and insurance companies would help ease the pressure.
On a brighter note, if Indian bonds get added to a major global index (the Bloomberg Global Aggregate Index), it could mean $10-20 billion flowing into the market—definitely something to watch.