In a first RBI aims to buy Rs 10,000 crore state bonds on October 22
Synopsis
It will aim to buy bonds of 15 state governments including Andhra Pradesh, Arunachal Pradesh, Maharashtra, Gujarat, Kerala, Madhya Pradesh. Those bonds are having residual maturities of about 9-11 years.
The Reserve Bank of India will buy more than a dozen state governments' bonds worth Rs 10,000 crore on October 22 for the first time making it a test case for future such operations where it could send signals on yields as well.While few know what’s in RBI’s mind with differing yields on different state bonds, investors believe that the operations could lead to convergence of yields.The RBI will purchase the SDLs (State Development Loans) as it
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