5-Year Sale Cancelled

Bonds gained on Friday after auctions saw sales of INR 220bn against a planned INR 320bn, the move provided some supply respite amid a weak appetite for debt. Bonds has been on the back foot after FinMin Sitharaman raised the possibility of front-loaded borrowing. "Even this year we have announced a borrowing calendar. I have made it clear that I will not hesitate to frontload as much is required," adding "In fact, that facility is being extended even to the states". Following the reduced sale size and signs that the RBI will not force participation at auctions, yields dropped.

• Auction results:
  • Cancelled INR 110bn 5.63% 2026 sale
  • Sold INR 48bn (planned INR 40bn) FRB 2033, yield 4.9390% (prev. 4.8400%) cover 3.75 (prev. 3.08)
  • Sold INR 132bn (planned INR 100bn) 6.64% 2035, yield 6.7625% (prev. 6.6116%), cover 2.65 (prev. 2.69)
  • Sold INR 40bn (planned INR 70bn) 6.67% 2050, yield 6.80% (prev. 6.7316%) cover 3.40 (prev. 2.21)
• India remains in the grip of a surge in virus cases with the situation exacerbated by lack of key medical supplies including oxygen. Chief Minister Arvind Kejriwal on Sunday announced extension of the ongoing lockdown in Delhi for another week, the lockdown imposed on April 19 night will now continue until May 3. While new cases continue to rise, India's vaccination drive is gathering steam, the health ministry claims 14m doses have been administered in 99 days. India is also stepping up support programmes, saying will spend 260 billion rupees ($3.5 billion) to provide free food grain for two months to people covered under the state-run food programme.