HALISTER1: Buy Indian Six-Year Bonds as Inflation Concern Eases: StanChart

Buy Indian Six-Year Bonds as Inflation Concern Eases: StanChart

(Bloomberg) -- Standard Chartered changes 3-month outlook for govt bonds to positive from neutral and recommends investors buy 6-year securities, analysts including Nagaraj Kulkarni write in note.
  • Recommends buying 6.84% 2022 govt bond FX-unhedged at current yield of 6.75%, with target of 6.40% and stop-loss of 6.95%
  • Sees value in 5-to-8-year sector of yield curve, will look to increase duration at appropriate time
  • Expects monetary policy committee to scale back hawkishness at June meeting, and lower rates by 25bps in August
  • Would have preferred to go long bonds in 10-to-15-year segment, but they have rallied ~30bps since April, with curve bull flattening
  • Forecasts 6.60% yield on new 10-year govt bond by end-September, versus 7.20% previously; 6.60% yield by end-March 2018 versus 7% previously
To contact the reporter on this story: Subhadip Sircar in Mumbai at ssircar3@bloomberg.net To contact the editors responsible for this story: Tan Hwee Ann at hatan@bloomberg.net Nicholas Reynolds

Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
STAN LN (Standard Chartered PLC)

People
Nagaraj Kulkarni (Standard Chartered PLC)

To de-activate this alert, click here
To modify this alert, click here

UUID: 7947283