H1 FY24 g-sec borrowing calendar: To increase slope and reduce curvature of the yield curve
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Mar 30, 2023
QuantEco Research || H1 FY24 g-sec borrowing calendar: To increase slope and reduce curvature of the yield curve
As per the g-sec borrowing calendar, the central government will borrow Rs 8.88 tn and Rs 7.29 tn on gross and net basis respectively in H1 FY24. From duration perspective, the extreme long end of the yield curve (21-40Y segment) will do the heavy lifting (~34% share in issuances) for the first time, followed by its belly (6-10Y segment) with ~31% share in issuances. Increase in issuance of longer dated g-secs and higher budgetary tax implication for insurance products (which typically favor long end g-secs) would result in steepening of the yield curve accompanied by a decline in curvature during the course of FY24.