INSUBCONTINENT EXCLUSIVE:
MUMBAI: Cost of borrowing in India should fall across the board, tracking the recent slide in government bond yields, with the latest debt
purchases by the central bank and softening prices of crude oil set to lower the broader market rates.
NBFCs that have recently battled a
funds crunch should also benefit
The RBI decided to purchase government bonds worth Rs 40,000 crore through open market operations in November, a move that should increase
cash availability in the banking system and stabilise rates
The benchmark b o n d yield dipped as much as eight basis points to 7.8 per cent Monday and ended at 7.81 per cent, the lowest since Aug 10
Bond yields and prices move in opposite directions
Dealers expect the sovereign gauge to touch 7.7 per cent in the next few weeks if crude oil prices remain under control
Global crude oil prices have lost more than 10 per cent in the past one month to trade around $77 per barrel now
December-end compared with 4 per cent as projected by the central bank
In October, RBI announced a Rs 36,000-crore OMO purchase.
