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Overseas investors are reducing their holdings of Indian bonds at a rapid pace due to rising US yields, leading to the largest outflows since the bonds were added to a major emerging-market index in June. Global funds sold a significant amount of Indian debt last week, alongside selling off local shares on concerns of a slowing economy. The appeal of Indian bonds has waned as US Treasury yields have increased post-Trump's election victory, with the spread between Indian and global markets narrowing. Despite expectations of a more hawkish Indian central bank, JPMorgan plans to increase India's weighting in its bond index, and DBS Group Holdings Ltd. predicts a decline in India's 10-year bond yield by the end of next year. [Extracted from the article]

Overseas investors are reducing their holdings of Indian bonds at a rapid pace due to increasing US yields, leading to the largest outflows since the bonds were added to a major emerging-market index in June. Global funds sold a significant amount of Indian debt last week, while also selling off Indian stocks amid concerns about the slowing economy. The appeal of Indian bonds has waned as US Treasury yields have risen post-Donald Trump's election, with the spread between Indian and global markets narrowing. The Indian central bank's hawkish stance and expectations of limited returns from local bonds are also contributing to the trend, although future selling may be moderated by upcoming index weight increases by major providers like JPMorgan and Bloomberg. [Extracted from the article]

Foreign investors are reducing their holdings of Indian bonds at a rapid pace due to increasing US yields, resulting in the largest outflow since the bonds were added to a major emerging-market index in June. The narrowing interest-rate differential between the US and India, along with a more hawkish Indian central bank, are contributing factors. Despite this, JPMorgan plans to increase India's weighting in its bond index, and other index providers are set to include Indian bonds in their emerging-market gauges next year. [Extracted from the article]

Foreign investors are withdrawing from India's bond market, leading to the first monthly outflow since April. This trend is partly due to the unwinding of total return swap trades linked to Indian government debt. The inclusion of Indian bonds in global indexes has increased market linkage, impacting flows. Factors such as US Treasury yields, Federal Reserve rate cuts, and reallocations to Chinese markets have influenced this shift in investment patterns. [Extracted from the article]

PineBridge Investments has chosen to avoid investing in Indian sovereign bonds due to bureaucratic challenges and a preference for higher returns in Latin America. Despite India's increasing popularity among global investors, PineBridge remains focused on Latin American bonds for their potential upside. While other investors have flocked to India, PineBridge has zero exposure to Indian sovereign debt but does hold dollar bonds issued by Indian corporates. The decision reflects concerns about settlement risks and the complexities of investing in India, despite the country's growth prospects and credible central bank. [Extracted from the article]

Indian sovereign bonds eligible for global debt inclusion experienced their first weekly outflow since being added to JPMorgan Chase & Co's emerging-market bond index. Overseas investors sold 16.8 billion rupees ($200 million) of these bonds last week, the largest outflow since May 10. The outflows were influenced by rising US Treasury yields, which may narrow the yield spread that Indian securities currently enjoy. Despite this, the weekly selling remains modest compared to the average weekly inflow of $570 million since the index inclusion. [Extracted from the article]

Indian sovereign bonds eligible for global debt inclusion experienced their first weekly outflow since being added to JPMorgan Chase & Co's emerging-market bond index. Overseas investors sold 16.8 billion rupees ($200 million) of these bonds last week, the largest outflow since May 10. The outflows were influenced by uncertainty surrounding the Federal Reserve's interest-rate cuts and elevated crude prices due to geopolitical tensions. Despite this, the weekly selling remains modest compared to the average weekly inflow of $570 million since the index inclusion. The announcement of inclusion in the FTSE Russell and Bloomberg emerging market indexes from January 2025 is expected to enhance the attractiveness of duration for Indian bonds. [Extracted from the article]

India's bonds are experiencing a strong rally, with the Reserve Bank of India adopting a more accommodative stance and FTSE Russell adding the country to its emerging-market debt index. This is expected to attract more foreign inflows and extend the bond rally. Indian bonds have already provided investors with a gain of over 8% this year, driven by foreign inflows resulting from their inclusion in JPMorgan Chase & Co.'s index. Analysts suggest that the RBI may cut rates in December, leading to a further decline in yields. [Extracted from the article]

India's bonds are experiencing a strong rally, with the Reserve Bank of India adopting a more accommodative stance and FTSE Russell adding the country to its emerging-market debt index. This is expected to attract more foreign inflows and extend the bond rally. Indian bonds have already provided investors with a gain of over 8% this year, driven by foreign inflows resulting from their inclusion in JPMorgan Chase & Co.'s index. Analysts suggest that the RBI may cut rates in December, leading to a further decline in yields. [Extracted from the article]

Indian and European regulators are currently in negotiations to resolve oversight issues regarding local clearing houses. If a resolution is not reached by the end of October, banks under the jurisdiction of Germany and France have been asked to make alternate arrangements with Indian custodians. The Reserve Bank of India denied the European Securities and Markets Authority's request to co-supervise Indian transactions, leading to ESMA withdrawing recognition from six Indian central counterparties. The dispute could disrupt trading in government bonds and interest-rate derivatives, potentially impacting European banks and trading volumes. Negotiations are ongoing, and a similar resolution between the RBI and the Bank of England could serve as a model. [Extracted from the article]

According to Reserve Bank of India Governor Shaktikanta Das, the strength of the Indian rupee is not artificially maintained and reflects the country's strong economic fundamentals. Das stated that India is attracting significant foreign-exchange inflows, particularly after bond index inclusion, which is supporting the rupee. He also expressed confidence in India's ability to sustain economic growth of up to 8% in the medium term. The central bank's interventions have helped keep the rupee stable, which is beneficial for markets, exporters, importers, and investors. India's foreign-exchange reserves have reached a record $689 billion, largely due to inflows into rupee bonds following their inclusion in JPMorgan Chase & Co.'s emerging-market index. Das also mentioned that the RBI's decision on interest rates will be primarily based on domestic conditions and not influenced by the US Federal Reserve. He emphasized that India's growth rate is expected to remain around 7.5% in the coming years. [Extracted from the article]

The Securities and Exchange Board of India (SEBI) is considering a plan to simplify the registration process for foreigners interested in investing in Indian government bonds. This move comes as foreign investors continue to pour money into index-eligible bonds, with August seeing net inflows of $2.8 billion. India's weight in the emerging market index is set to increase, and the regulator is also looking into easing the application process for sovereign wealth funds and public retail funds. Additionally, SEBI has established a dedicated cell for foreign portfolio investors to address any registration issues they may face. [Extracted from the article]

India's central bank, the Reserve Bank of India (RBI), has downplayed concerns over recent restrictions it imposed on foreign ownership of bonds eligible for inclusion in a global index. The RBI's Deputy Governor, Michael Patra, stated that foreigners own only two trillion rupees ($23.7 billion) of the 41 trillion rupees ($488 billion) worth of bonds available to them, indicating that the situation is not as dire as it may seem. The central bank's move to limit access to newly issued Indian government bonds with 14-year and 30-year tenors surprised investors, coming just a month after JPMorgan Chase & Co. included Indian government securities in its main emerging-market index. Patra explained that the majority of foreign investments are in 5 to 10 year maturities, and the concentration of these investments in this segment is expected to increase liquidity and improve price discovery. JPMorgan estimates that the inclusion of Indian government bonds in its index will result in approximately $25 billion of inflows over a ten-month phase-in period, raising concerns about how authorities will manage the large inflows and potential volatility. [Extracted from the article]

India's central bank, the Reserve Bank of India (RBI), has downplayed concerns over recent restrictions it imposed on foreign ownership of bonds eligible for inclusion in a global index. The RBI's Deputy Governor, Michael Patra, stated that foreigners own only two trillion rupees ($23.7 billion) of the 41 trillion rupees ($488 billion) worth of bonds available to them, indicating that the situation is not as dire as it may seem. The central bank's move to limit access to newly issued Indian government bonds with 14-year and 30-year tenors surprised investors, coming just a month after JPMorgan Chase & Co. included Indian government securities in its main emerging-market index. Patra explained that the majority of foreign investments are in 5 to 10 year maturities, and the concentration of these investments in this segment is expected to increase liquidity and improve price discovery. JPMorgan estimates that the inclusion of Indian government bonds in its index will result in approximately $25 billion of inflows over a ten-month phase-in period, raising concerns about how authorities will manage the large inflows and potential volatility. [Extracted from the article]

Indian government bonds eligible for index inclusion received a record $1.1 billion in overseas inflows last week, indicating that the central bank's restrictions on these securities have not deterred investor sentiment. Despite the Reserve Bank of India's efforts to limit access to new government bonds with longer tenors, foreign investors continue to prefer shorter-term bonds. The increase in India's weight on JPMorgan Chase & Co.'s emerging market index has also contributed to the inflows. Foreign ownership of these bonds has risen to 5.1% of the total outstanding. [Extracted from the article]

India is expected to maintain its target of raising 14.1 trillion rupees ($169 billion) through bond sales in the current fiscal year, according to a Bloomberg survey of economists. The budget deficit is not expected to widen, indicating the government's commitment to fiscal prudence. This approach has attracted global investors to Indian debt. While some spending may be increased to address job creation and rural distress, the government is not expected to deviate significantly from its prudent financial plan. The deficit target is projected to be slightly lower at 5% of GDP for the current fiscal year, with a further reduction to below 4.5% by 2026. [Extracted from the article]

India's new government, led by Prime Minister Narendra Modi, is expected to maintain its target of raising 14.1 trillion rupees ($169 billion) through bond sales in the current fiscal year. A Bloomberg survey of economists found that not a single respondent expects the budget deficit to widen, indicating the government's commitment to fiscal prudence. This approach has helped attract global investors to Indian debt. While there is pressure to provide funds for coalition partners, a modest expenditure plan could boost India's bond market. The budget will be unveiled on July 23. [Extracted from the article]

India's sovereign bond market is becoming popular among foreign equity investors who are using the bonds as collateral for trade margin requirements. The inclusion of India's government debt in JPMorgan Chase & Co.'s emerging-market bond index has increased their acceptance as collateral. This development is appealing to overseas investors as they can now earn interest on their bond holdings. The combination of high yield, a stable currency, and the possibility of capital appreciation has created a new demand segment for Indian government securities. Foreign investors have invested 978 billion rupees ($11.7 billion) into index-eligible bonds since JPMorgan announced their inclusion last year. India has also attracted equity inflows of $2.6 billion so far this year, adding to net overseas investments of $21 billion in 2023. [Extracted from the article]

Foreign banks are increasing their purchases of short-term Indian bonds due to improved liquidity and limited supply. Since June, foreign banks have bought nearly 600 billion rupees ($7.2 billion) in all maturities, while state-run banks and mutual funds have been selling. The preference for shorter-dated bonds is driven by lower supply of treasury bills and improved banking liquidity. The inclusion of Indian sovereign bonds in JPMorgan's emerging-market index has also raised demand for bonds. The Reserve Bank of India is expected to cut interest rates by 100 basis points in the next 18 months. [Extracted from the article]

Foreign banks are increasingly purchasing shorter-term Indian sovereign bonds due to improved liquidity and limited supply. Since June, foreign banks have bought nearly 600 billion rupees ($7.2 billion) in bonds, while state-run banks and mutual funds have been selling. The preference for shorter-dated bonds is driven by lower supply of treasury bills and improved banking liquidity. The inclusion of Indian sovereign bonds in JPMorgan's emerging-market index has also increased demand. The Reserve Bank of India is expected to cut interest rates by 100 basis points in the next 18 months. [Extracted from the article]

According to Bloomberg, global funds are expected to register in India and directly purchase the country's bonds as its weight in the JPMorgan Chase & Co. emerging market index increases to 5% by October. This development comes after several clients of JPMorgan expressed their intention to enter the Indian market directly, rather than through proxy exposures. The inclusion of India in the index is expected to attract significant liquidity and result in $20-$25 billion of inflows into Indian debt. The country's capital markets regulator is also working to reduce paperwork for foreign investors buying sovereign debt. [Extracted from the article]

Indian sovereign bonds are expected to continue gaining value after their best annual performance in three years. The upcoming inclusion of these bonds in a global bond index is anticipated to attract significant foreign investment, potentially reaching up to $40 billion. Additionally, the possibility of rate cuts by the Reserve Bank of India and a fiscally conservative budget are expected to further drive bond investments. The demand for bonds is also predicted to exceed supply in the coming fiscal year. [Extracted from the article]

JPMorgan Chase & Co. is set to add India's government bonds to its emerging markets index, which is expected to attract billions of dollars in investments. Global funds have already invested close to $11 billion in index-eligible bonds, and JPMorgan predicts that $20 billion to $25 billion will come in over the next 10 months. India's debt has become popular among emerging market investors due to its strong economic growth and stable currency. Indian bonds offer access to a high-growth, high-yield market, and the country's sovereign debt has outperformed its index counterparts over the past decade. [Extracted from the article]

India is expected to attract billions of dollars in investments as JPMorgan Chase & Co. adds the country's government bonds to its emerging markets index. Global funds have already invested close to $11 billion in index-eligible bonds since the announcement, and JPMorgan predicts that $20 billion to $25 billion will come in over the next 10 months. India's debt has become popular among emerging market investors due to its strong economic growth and stable currency. The inclusion of Indian bonds in the index offers global investors access to a high-growth, high-yield market. [Extracted from the article]

India is expected to attract billions of dollars in investments as JPMorgan Chase & Co. includes the country's government bonds in its emerging markets index. Global funds have already invested close to $11 billion in index-eligible bonds, and JPMorgan predicts that an additional $20 billion to $25 billion will be invested over the next 10 months. India's debt has become popular among emerging market investors due to its strong economic growth and stable currency. The inclusion of Indian bonds in the index will provide global investors with access to a high-growth, high-yield market. [Extracted from the article]

India is expected to attract billions of dollars in investments as JPMorgan Chase & Co. adds the country's government bonds to its emerging markets index. Global funds have already invested close to $11 billion in index-eligible bonds since the announcement in September, and JPMorgan predicts that $20 billion to $25 billion will come in over the next 10 months. India's debt has become popular among emerging market investors due to its strong economic growth and stable currency. The inclusion of Indian bonds in the index will provide global investors with access to a high-growth, high-yield market. [Extracted from the article]

According to Citigroup Inc.'s top local trader, global investors who have purchased Indian government bonds in anticipation of their inclusion in a major debt index are likely to remain invested rather than selling for a quick profit. India's debt yields are higher than China's or the US, and its economy is the fastest-growing among the Group of 20. The inclusion in the index is expected to attract around $30 billion of capital into India. While there were concerns about increased government spending after Prime Minister Narendra Modi's re-election, the reappointment of Nirmala Sitharaman as finance minister is seen as a sign of fiscal continuity. The 10-year yield may drop to around 6.80% to 6.85% if the government maintains fiscal consolidation in its upcoming budget. [Extracted from the article]

According to Citigroup Inc.'s top local trader, global investors who have purchased Indian government bonds in anticipation of their inclusion in a major debt index are likely to remain invested rather than selling for a quick profit. India's debt yields are higher than China's or the US, and its economy is the fastest-growing among the Group of 20. The inclusion in the index is expected to attract around $30 billion of capital into India. While there were concerns about increased government spending after Prime Minister Narendra Modi's re-election, the reappointment of Nirmala Sitharaman as finance minister is seen as a sign of fiscal continuity. The 10-year yield may drop to around 6.80% to 6.85% if the government maintains fiscal consolidation in its upcoming budget. [Extracted from the article]

According to Citigroup Inc.'s top local trader, global investors who have purchased Indian government bonds in anticipation of their inclusion in a major debt index are likely to remain invested rather than selling for a quick profit. India's debt yields are higher than China's or the US, and its economy is the fastest-growing among the Group of 20. The inclusion in the index is expected to attract around $30 billion of capital into India. While there were concerns about increased government spending after Prime Minister Narendra Modi's re-election, the reappointment of Nirmala Sitharaman as finance minister is seen as a sign of fiscal continuity. The 10-year yield may drop to around 6.80% to 6.85% if the government maintains fiscal consolidation in its upcoming budget. [Extracted from the article]

Prime Minister Narendra Modi's smaller-than-expected victory in the recent election has raised concerns among bond investors about the potential impact of populism on India's debt dynamics. Many investors were anticipating a supermajority win for Modi, which would have allowed him to reduce the budget deficit and further cut government borrowing. However, the election results showed that Modi's Bharatiya Janata Party fell short of a majority, leading to a selloff in Indian assets. There are fears that more populistic measures could be undertaken, leading to increased spending and potential fiscal consolidation stress. [Extracted from the article]

India's markets experienced a significant decline as initial election results indicated that Prime Minister Narendra Modi's ruling party was struggling to secure a majority of seats. The NSE Nifty 50 Index dropped by 8.5%, the largest intra-day drop in over four years. Modi's Bharatiya Janata Party and its allies were leading in more than 290 seats, just above the 272 seats needed for a majority. This narrower-than-expected victory raises concerns about the government's ability to implement crucial reforms. Opposition parties formed a united front to challenge Modi, focusing on appealing to voters who felt excluded from India's growth story. The outcome of the election will impact the government's ability to push through reforms and may lead to a broader fiscal push and populism in the budget. [Extracted from the article]

India's markets experienced a significant decline as initial election results indicated that Prime Minister Narendra Modi's ruling party was struggling to secure a majority of seats. The NSE Nifty 50 Index dropped by 8.5%, the largest intra-day drop in over four years, as the Bharatiya Janata Party-led alliance had a slimmer lead than predicted by exit polls. A narrow victory for Modi's alliance raises concerns about the government's ability to implement crucial economic reforms. The rupee weakened against the dollar, and the yield on the 10-year bond rose. Despite the uncertainty, investors anticipate continuity in the government's infrastructure and manufacturing-focused growth strategy. [Extracted from the article]

Prime Minister Narendra Modi's smaller-than-expected victory in the recent election has raised concerns among bond investors about the potential for increased populism. Many investors were anticipating a supermajority win for Modi, which would have allowed him to reduce the budget deficit and government borrowing. However, the election results shocked traders and led to a sell-off in Indian assets. There are fears that more populist measures could be implemented, leading to increased spending and potential fiscal consolidation stress. Modi will also face crucial state elections in the coming months. [Extracted from the article]

JPMorgan Chase & Co. is set to include India in its emerging market debt index in June, with most of its clients ready to trade despite some initial challenges. The firm's global head of index research, Gloria Kim, stated that market feedback has been largely positive, and any issues have been related to operational readiness and flexibility rather than barriers to entry. JPMorgan estimates that foreign inflows into India could be between $20 billion and $25 billion, and the inclusion of India in global bond indexes is expected to attract more foreign investors and contribute to the nation's financial market growth. The Indian government has implemented market reforms to improve accessibility and tradability for foreign investors, making them more comfortable with investing in Indian government bonds. [Extracted from the article]

JPMorgan Chase & Co. is set to include India in its emerging market debt index in June, with most of its clients ready to trade. The firm's global head of index research, Gloria Kim, stated that market feedback has been largely positive, and any issues have been related to operational readiness and flexibility rather than barriers to entry. JPMorgan estimates that foreign inflows into India will be between $20 billion and $25 billion. The Indian government has made substantial market reforms to improve accessibility and tradability for foreign investors, including extending the trade-matching window and streamlining the onboarding process. [Extracted from the article]

Tata Asset Management Pvt., an Indian fund manager, has reduced the average maturity of its flagship bond fund in anticipation that the central bank will not lower interest rates before global peers. The fund manager has cut the average maturity to about five years, compared to nearly 14 years for the benchmark Crisil dynamic gilt index. This move goes against the trend of other fund managers and reflects concerns about delayed easing cycles by central banks, a strengthening dollar, and the possibility of a spike in crude oil prices. The fund manager is also increasing investments in the five to ten-year segment of the bond market to reduce interest-rate risk. They believe that the Reserve Bank of India will take 12 to 18 months to reach its inflation target and will not rush to withdraw the tightening cycle. [Extracted from the article]

Bank of America's top India trader, Vikas Jain, believes that Indian rates traders have underestimated the likelihood of an interest-rate cut, creating an opportunity in the swaps market. While the Reserve Bank of India is expected to cut the key policy rate by 100 basis points in the next two years, interest rate swaps are not pricing in any cuts during that period. Jain argues that traders are too focused on geopolitical tensions and not enough on easing price pressures locally. He suggests that investors should position for a drop in the two-year overnight index swap, which may decline by up to 35 basis points over the next year. Jain also expresses confidence in the Indian rupee and government bonds, stating that they are a shelter from current volatility and that bonds look attractive given index inclusion inflows. He predicts that the rupee may trade in the 82.5-84 per dollar range this year. [Extracted from the article]

ANZ Group Holdings Ltd. is in talks with Australian pension funds to invest in India's infrastructure assets and debt market. The bank will assist the pension funds by identifying suitable assets and connecting them to potential investment opportunities. India's infrastructure sector requires significant funding, while Australian funds are seeking global investment opportunities due to limited domestic options. The Indian government bonds are also becoming an attractive investment avenue, offering 7%-7.50% returns. ANZ has increased its capital base in India to A$600 million over the past two years and aims to expand its presence in the country. [Extracted from the article]

India plans to sell fewer bonds than initially estimated as the government reins in spending ahead of elections and the inclusion of the nation's debt in global indexes. The finance ministry announced that bonds worth 7.5 trillion rupees ($90 billion) will be sold in the first half of the fiscal year, lower than the 8.5 trillion rupees estimated in a Bloomberg survey. The decision to reduce borrowing is due to the government's desire to avoid sitting on unused cash, according to Finance Secretary TV Somanathan. The sale comes as foreign funds have shown interest in Indian debt ahead of their inclusion in JPMorgan Chase & Co.'s global indexes in June. [Extracted from the article]

Foreign investors are reassessing their investments in Indian assets after the Indian rupee hit a record low. This has led to the biggest selloff in Indian bonds in a year, with global funds selling a net $425.3 million of rupee-denominated bonds. The selloff highlights the need for investors to manage currency risk, as the Reserve Bank of India's efforts to keep the rupee stable may have left investors with unhedged positions. Foreign funds have been attracted to Indian debt ahead of their inclusion in global bond indexes, but the recent decline in the rupee may lead to further volatility. [Extracted from the article]

Foreign inflows into India's sovereign bond market are nearing $10 billion as the country prepares to be included in JPMorgan Chase & Co's emerging markets debt index. Investments into index-eligible bonds have increased by $9.8 billion since the announcement in September, with the majority of purchases being in shorter-term bonds maturing between 2026 and 2030. Analysts predict that rupee sovereign bonds will continue to gain value due to strong foreign inflows. Bloomberg Index Services Ltd. will also include some India bonds in its emerging market local currency index next year. [Extracted from the article]

SBI Pension Funds Pvt., which manages $50 billion in assets, is considering investing in corporate and state debt due to the narrowing spreads on longer-maturity Indian government bonds. The fund's chief investment officer, Sandeep Pandey, expressed concern that the lack of term premium for longer-dated securities could impact returns for subscribers. Demand for longer-tenor papers has increased, leading to a compression in the spread between 10-year and 30-year bonds. The fund currently holds a portfolio of about one trillion rupees in corporate paper and 2.5 trillion rupees in sovereign and state debt. [Extracted from the article]

SBI Pension Funds Pvt., which manages $50 billion in assets, is considering investing in corporate and state debt due to the narrowing spreads on longer-maturity Indian government bonds. The demand for longer-tenor papers has increased, leading to a compression in the spread between 10-year and 30-year bonds. The fund is also positioning for a rate cut and expects the central bank to cut interest rates by September. [Extracted from the article]

Foreign investors are increasingly buying India's sovereign bonds in anticipation of the country's inclusion in global debt indexes. It is expected that these investors will play a significant role in the near-record government borrowing in the upcoming fiscal year. Foreigners have already invested over 500 billion rupees in index-eligible debt since JPMorgan Chase & Co's announcement in September. The inclusion of Indian government bonds in benchmark indexes is expected to attract $100 billion in inflows in the coming years. This surge in foreign investment is seen as a game-changer for demand dynamics in the fiscal year 2025. The Reserve Bank of India's decision to keep interest rates high makes the favorable demand-supply backdrop for government debt a relief. Prime Minister Narendra Modi's administration is expected to present a fiscally conservative interim budget, with the fiscal deficit projected to narrow. The growing presence of long-term investors like insurers and pension funds is also reducing the government's reliance on debt purchases by banks. Overall, the outlook for India's bond market is positive, with expectations of lower yields and increased foreign investment. [Extracted from the article]

Global funds are investing in India's sovereign bonds in anticipation of the country's inclusion in global debt indexes. Foreign investors have already put more than 500 billion rupees into index-eligible debt since JPMorgan Chase & Co's announcement in September. It is expected that India's bonds will attract $100 billion in inflows in the coming years due to the country's rapid economic growth. This foreign investment is expected to be a game-changer for demand dynamics in the fiscal year 2025. The Reserve Bank of India's decision to keep interest rates high makes the favorable demand-supply backdrop for government debt a relief. Prime Minister Narendra Modi's administration is expected to present a fiscally conservative interim budget on February 1, and the fiscal deficit is projected to narrow. The growing presence of longer-term investors, such as insurers and pension funds, is helping reduce the government's reliance on debt purchases by banks. The benchmark 10-year yield is predicted to drop in the coming fiscal year. [Extracted from the article]

Indian sovereign bonds had their best annual performance in three years and are expected to continue gaining due to their upcoming inclusion in a global bond index, which is anticipated to attract significant foreign investment. Foreigners bought $8.4 billion of local bonds last year, the highest amount in six years, with particular interest in the index-eligible Fully Accessible Route (FAR) bonds. The Reserve Bank of India is also expected to cut interest rates earlier than expected, which could further stimulate bond investments. Additionally, the upcoming federal budget is expected to be fiscally conservative, easing concerns over excessive spending. The demand for bonds is projected to exceed supply in the coming fiscal year, driven by long-term investors such as insurers and pension companies. [Extracted from the article]

Even as the government is borrowing a record 15.43 trillion rupees of bonds in the current fiscal year, bonds in India have been relatively less volatile compared to their US counterparts, partly due to higher demand from insurers and pension companies. (Bloomberg) -- Sign up for the India Edition newsletter by Menaka Doshi - an insider's guide to the emerging economic powerhouse, and the billionaires and businesses behind its rise, delivered weekly. [Extracted from the article]

(Bloomberg) -- Insurers in India are lining up to grab a share of the nation's debut 50-year bond offering, highlighting the growing heft of long-term investors in the nation's $1 trillion debt market. Even as the government is borrowing a record 15.43 trillion rupees of bonds in the current fiscal year, bonds in India have been relatively less volatile compared to their US counterparts, partly due to higher demand from insurers and pension companies. [Extracted from the article]

(Bloomberg) -- Sign up for the India Edition newsletter by Menaka Doshi - an insider's guide to the emerging economic powerhouse, and the billionaires and businesses behind its rise, delivered weekly. The entry of index investors should also open up room for local credit markets to expand, with companies not getting crowded out by government borrowings, Citigroup Inc. said in a note. [Extracted from the article]