Federal Government Bonds End Flat as Market Awaits Second-Half Borrowing Plan; RBI Rate Decision in Focus

Upgraded 22 September 2025 at 20:03 IST

Federal government bond yields ended flat at 6.4885%, with markets waiting for the second-half loaning calendar due late September. Financiers stay mindful on longer-term financial obligation supply. RBI’s October 1 policy choice is crucial, with expectations of constant rates and possible later on relieving amidst benign inflation.

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Indian federal government bonds ended flat on Monday, with market individuals very carefully waiting for information of New Delhi’s loaning prepare for the 2nd half of the.

The yield on the 10-year standard note settled at 6.4885%, matching the previous close of 6.4885 %.

The upcoming loaning calendar release, slated for late September, will be an essential trigger for the marketplace as financiers are worried about the supply of longer tenor financial obligation possibly going beyond need.

Previously this month, numerous market individuals suggested that the Reserve Bank of India think about decreasing the percentage of ultra-long bonds and cutting the size of weekly auctions.

“Announcement of second half borrowing calendar will be keenly awaited and duration supply there will decide next market movement,” stated Gopal Tripathi, head of treasury and capital markets at Jana Small Finance Bank.

In focus is the RBI’s upcoming policy choice, due October 1, where the RBI is anticipated to hold rates stable. A 25-basis-point cut later on in the year is what lots of market individuals are considering, traders stated.

That’s even as Soumya Kanti Ghosh, group primary financial consultant at India’s biggest loan provider State Bank of India, stated the reserve bank’s best option is to slash the essential rate of interest by 25 bps at the next chance, considered that inflation stays benign.

In June, RBI cut its policy repo rate by 50 bps however altered position to neutral, while in August it kept status quo.

India’s over night index swap rates ended little bit altered after dropping in the previous session.

Traders see space for getting in India’s shorter-duration over night index swap rates on bets of more RBI reducing by December.

The 1 year OIS rate ended at 5.4475%, while the two-year OIS rate closed at 5.42%.

The liquid five-year OIS rate increased 1 bp to settle at 5.72%.