India borrowing target not cause for disappointment: StanChart
Reuters Market Eye - Standard Chartered says India's debt investors "need not be disappointed" with the government's 2013/14 gross borrowing target of 6.29 trillion rupees announced on Thursday, which had sent bonds to their worst day in seven months in the previous session.
After adjusting for a buyback of 500 billion rupees, the gross borrowing is at 5.79 trillion rupees, only 4 percent higher than in the current fiscal year ending in March, StanChart says.
The bank adds India had not budgeted for any cash drawdown in 2013/14, despite a cash surplus estimated at 1 trillion rupees, which the government may have retained as a cushion should revenues fall below its estimates.
"We believe such a large cash surplus has the potential to surprise the markets positively," StanChart says.
Easing inflation and rate cut hopes should be positive for bonds, the bank adds, recommending investors hold 10-year bonds.
(Reporting by Subhadip Sircar)
- Tweet this
- Share this
- Digg this
- U.S. nurse quarantined over Ebola calls treatment "frenzy of disorganization"
- Wall Street finally turning on Amazon as Bezos magic fades
- Google executive sets new stratosphere skydive world record
- Former Cream frontman Jack Bruce dies aged 71
- São Paulo running out of water as rain-making Amazon vanishes
Finance Minister Arun Jaitley favours a cut in interest rates to trigger demand in the construction sector, a newspaper report said on Saturday, but the Reserve Bank of India (RBI) has signalled it will not ease policy until it is confident of lower inflation. Full Article
Euro zone risks "relapse into recession" without structural reforms - Draghi. Full Article
Kalki Koechlin on her role as a disabled girl in “Margarita, With a Straw” Full Article