The central government will borrow Rs 6.55 tn and Rs 3.74 tn on gross and net basis respectively in H2 FY24 via dated securities.

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Sep 26, 2023

QuantEco Research || H2 FY24 g-sec borrowing calendar: Fine-tuning with respect to demand

For the first time, the government will issue a 50Y security (worth Rs 300 bn). In addition, green bonds worth Rs 200 bn would also be a part of H2 borrowing calendar. Month of Oct-23 and Nov-23 would see the max and min issuance on net basis. Overall, net borrowing will reduce sharply in H2 FY24, constituting just about half of that in H1 FY24. It would also be the lowest half-yearly borrowing in last 2-years. This along with expectation of a moderation in inflation trajectory and index inclusion related market positioning could push 10Y g-sec yield towards 6.90% by Mar-24 vs. our earlier expectation of 7.00%.