The Indian government bought back bonds maturing in 2024 from the Reserve Bank of India, while also issuing bonds maturing in 2032 worth a similar quantum, the central bank said. The transaction involved buying back a security maturing in FY2024/25 from the Reserve Bank and issuing fresh security for equivalent market value, to make the transaction cash neutral. The transaction was carried out using Financial Benchmarks India Pvt Ltd. (FBIL) prices.
Buy Prime Test Series for all Banking, SSC, Insurance & other exams
The government bought back 6.18% bonds maturing in 2024 worth 226.10 billion rupees ($2.78 billion) at a price of 98.62 rupees while it issued 8.28% 2032 bonds worth 210.26 billion rupees to the RBI at 106.05 rupees.
Before this switch, New Delhi had switched bonds worth over 820 billion rupees this financial year, below its target of 1 trillion rupees.
India is likely to undertake bond switch auctions with the RBI to meet its target for fiscal. Government of India has been undertaking conversion with the objective of smoothening its liability profile as well as for market development.
The term cash neutral refers to an investment strategy that involves the sale and purchase of securities in an investment portfolio that results in zero net cash. Sales and purchases in a cash-neutral strategy effectively cancel each other out. Keeping portfolios cash neutral means having capital fully deployed in investments at all times.
Every year on December 22, India celebrates National Mathematics Day. This date marks the birth…
In competitive exams like SSC, Defence, State Exams, and Railways, current affairs are crucial. This…
On Saturday, December 21, 2024, several explosive-laden drones, believed to be part of Ukraine's ongoing…
Uttar Pradesh, one of India's most populous states, is known for its rich cultural and…
The 55th GST Council meeting, chaired by Finance Minister Nirmala Sitharaman, convened ministers from 28…
India participated in the 24th BIMSTEC Senior Officials Meeting (SOM), hosted virtually by Thailand on…