Oversupply of India bonds to drive yields to 8%: Standard Chartered

Standard Chartered estimates that excess India bond supply may total between Rs 3.8 trillion to Rs 6.3 trillion this fiscal year, according to a June 8 note

Rupee, bonds market, funds
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Subhadip Sircar | Bloomberg
A supply glut is set to hit India’s government bond market, and drive benchmark yields toward 8 per cent by year-end, according to Standard Chartered Plc.

The lender estimates that excess supply of sovereign and state debt may total as much as Rs 6.3 trillion ($81 billion) this fiscal year. That’s likely to further upset a market that’s struggling to cope with rising interest rates and dwindling surplus liquidity, said Parul Mittal Sinha, head of India financial markets at the bank.

“It may keep becoming incrementally more difficult for supply to be absorbed by the market,” said Sinha, who has spent more

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First Published: Jun 22 2022 | 7:28 AM IST

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