10-year bond yields jump 14 bps on higher government borrowing plans
Gross borrowing was expected to be ₹10.60 trillion and net borrowing at ₹8 trillion, according to a median forecast of 15 analysts surveyed by Bloomberg news
MUMBAI: Yields on 10-year bonds surged 14 basis points after finance minister Nirmala Sitharaman said the government plans to borrow a gross ₹12 trillion over the next financial year.
Gross borrowing was expected to be ₹10.60 trillion and net borrowing at ₹8 trillion, according to a median forecast of 15 analysts surveyed by Bloomberg news.
The government also said the fiscal deficit for fiscal 2021 stood at 9.5%. As part of this, the government will borrow another ₹80,000 crore in the next two months of this year alone.
For FY22, the fiscal deficit is pegged at 6.8% of GDP.
According to Bloomberg forecast, the government's fiscal deficit target was at 6.6% of GDP in fiscal 2021, above the 3.5% target. For fiscal 2022 it expects the deficit to narrow to 5.5% of GDP.
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