The government bond yield curve is likely to flatten in the financial year 2027 (FY27) as the Reserve Bank of India (RBI) is expected to ease supply pressure in the ultra-long segment. In FY26 so far, reduced investments by insurance companies and pension funds pushed up yields on ultra-long tenor securities, steepening the curve.
Markets regulator Sebi has barred US-based Jane Street Group from the securities markets and directed the group to disgorge unlawful gains of Rs 4,843 crore for allegedly manipulating stock indices through positions taken in derivatives segment. This could be the highest disgorgement amount ever directed by the Securities and Exchange Board of India (Sebi).
The strategy was straightforward - aggressively buy select Bank Nifty index stocks in the morning and sell them just as forcefully later in the day, triggering a sharp drop in share prices.
'Consider 40% to 50% in equities, 10% in gold as a hedge, and the remaining 30% to 40% split between multi-asset funds and hybrid funds.'
Days after Moody's cut its gross domestic product (GDP) forecast for financial year 2022-23 (FY23) after the official GDP print for the June quarter came in lower than expectations, the global ratings agency said it would maintain its long-term sovereign debt credit rating and outlook on Asia's third-largest economy. "The credit profile of India reflects key strengths, including its large and diversified economy with high growth potential, a relatively strong external position, and a stable domestic financing base for government debt," Moody's said on Tuesday. "We do not expect rising challenges to the global economy, including the impact of the Russia-Ukraine military conflict, higher inflation, and the tightening financial conditions on the back of policy tightening, to derail India's ongoing recovery from the pandemic in 2022 and 2023," it said.
Flush with liquidity, banks are eager to lend. And, therein lies the problem, warns Tamal Bandyopadhyay.
Concerned over inflationary pressures in the economy, the Reserve Bank of India (RBI) is bringing down surplus liquidity in the system rapidly. It has fallen to pre-Covid levels and almost 2 per cent of banks' net demand and time liabilities (NDTL). NDTL shows the difference between the sum of demand and time liabilities (deposits) of a bank (with the public or the other bank) and the deposits in the form of assets held by the other bank.
Ratings agency Moody's on Tuesday affirmed India's sovereign rating and upgraded the country's outlook to 'stable' from 'negative', citing receding downside risks to the economy and financial system.
The improved outlook on the Government of India announced by rating agency Moody's might need to be viewed with some scepticism. There is no doubt the performance of the Indian economy has sharply improved from the deep trough it hit last year. But the ability of the second largest global ratings agency to assess an upside and downside before events make everyone wise about India has been dismal for a long time, as the chart shows.
Before the pandemic hit the world and led to shutdowns, the company had received nearly half a dozen offers. But bidders are now withdrawing. They want to reassess the situation. They want to conserve cash and avoid acquisition.
After rising for more than a year, short-term interest rates have started falling since the beginning of the month, thanks to improved liquidity.
Gandhi alleged that the Bharatiya Janata Party government has "blocked" the money of the poor through currency ban to favour a "handful of industrialists".
In spite of ample liquidity, banks are treading cautiously as far as lending to the real estate sector is concerned, and are seeking collateral as high as 150 per cent of the loan amount as security deposit from them.
Even as the market remained flush with liquidity, banks were in no mood for subscribing to fresh corporate bonds or commercial papers ahead of the annual policy review. According to market dealers, the 10-year, AA-rated bond issue of Tata Power to raise funds devolved on its lead arranger Standard Chartered Bank. The bank did not offer any comment when contacted.
The tightness in liquidity will be much more pronounced as banks are expected to borrow to expand their balance sheets to meet annual targets
Rajan said that despite easy liquidity, banks have passed rate cuts into lending rates modestly.
The implementation of MCLR from April 1 has already led to a rate cut of 10 basis points on home loans by the country's largest bank, State Bank of India, and others.
The changes would be the most ambitious overhaul to date of rules governing the liquidation or revival of companies in India.
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