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Business News/ News / India/  10-year bond yields jump 14 bps on higher government borrowing plans
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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

In a bid to clean up election funding, the government had in January introduced electoral bonds that can be bought from specified branches of State Bank of India and used to donate money to political parties. Photo: iStockphotoPremium
In a bid to clean up election funding, the government had in January introduced electoral bonds that can be bought from specified branches of State Bank of India and used to donate money to political parties. Photo: iStockphoto

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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Published: 01 Feb 2021, 01:23 PM IST
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