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Bonds fall after RBI deputy governor warns banks of high interest rate risk

The statement was seen by traders as hawkish and as a message asking them to bring down their bond holdings

Reuters  |  MUMBAI 

Bond yields spiked on Tuesday morning after a deputy governor of the Reserve Bank of India (RBI) said public sector lenders face risks of high interest rate from their large bond holdings. The statement was seen by traders as hawkish and as a message asking them to bring down their bond holdings. "The size of the banking sector's balance-sheet exposure to G-Secs, and hence its interest rate risk, is high in an absolute sense, and is relatively elevated, when measured in proportion to total assets, for public sector banks relative to private banks," Deputy Governor ...

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First Published: Tue, January 16 2018. 13:41 IST
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