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Can the Reserve Bank talk the bond yield down?

Why are the bond yields hardening when there is ample liquidity in the system and RBI is willing to do anything to ensure a non-disruptive market borrowing by the government?

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Tamal Bandyopadhyay
In an interview with a TV channel last Friday, Reserve Bank of India (RBI) Governor Shaktikanta Das reiterated the central bank’s commitment to growth and financial stability, saying it is battle ready. All conventional and unconventional, and even “new” weapons, are on its table, he said. It will use anything and everything, if required.

Das also said that as the government’s debt manager, the RBI would ensure the completion of market borrowing in a “non-disruptive” manner.

Hours after the interview, the debt manager had to settle for higher yields to see through three auctions of government bonds, maturing between five
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First Published: Aug 23 2020 | 8:50 PM IST

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