Halister News

(Bloomberg) -- Short-end India govt bond valuations are attractive, even if the RBI maintains a stable monetary policy regime and does not lower interest rates further, Standard Chartered analysts including Anubhuti Sahay and Nagaraj Kulkarni wrote in a report.

• StanChart holding on to long 6.84% 2022 govt bond recommendation
  • Target 6.40% with stop loss at 6.95%; yield currently up 1bp to 6.69%
• Doesn’t see SLR reduction as negative for govt bonds because private-sector credit growth remains subdued
• Market expectations on INR have swung from being too positive a few months back to being too negative currently, even as fundamentals have remained relatively well-balanced, analysts wrote in note dated Oct. 4
  • Keep short-term neutral weighting on INR; maintain USD/INR forecast at 64.50 for end-2017 and 66 for end-2018
  • USD/INR will continue to trade in a range; INR carry will remain attractive
• USD/INR little changed at 65.0325 after sliding 0.8% on Wednesday following RBI’s rate decision

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 Shikhar Balwani