Halister News

(Bloomberg) -- Govt bonds head for weekly decline ahead of naming of a successor to RBI Governor Rajan whose term ends in early September.

• NOTE: PM Modi and Finance Minister Jaitley met yday to discuss names, Economic Times reports; “We will let you know when we decide,” Jaitley was quoted as saying
• New RBI governor needs to maintain independence of central bank and enhance foreign investors’ confidence, which then will be INR-supportive, Scotiabank writes in note
• Panel recommends allowing corporate bonds under repo ops
• Public banks were biggest buyers of govt bonds on Aug. 18 at 64.2b rupees: CCIL data; private banks were biggest sellers at 38.6b rupees
• Global funds raised INR bond holdings by 1.7b rupees on Aug. 18: NSDL
• India to sell 150b rupees of govt bonds today; RBI to conduct 190b rupees 14-day term repo auction
• Yield on 10-year govt bonds up 1 bp at 7.15%, poised for weekly increase of 4 bps
• While technicals of weaker USD and high carry are supportive of INR, markets are cautious ahead of RBI governor announcement as well as upcoming non-resident deposit repayments, Morgan Stanley writes in note dated yday
  • Stronger fundamentals of lower current-account deficit and high FX reserves as well as RBI’s forward purchases to prepare for dollar-deposit redemptions should help offset impact from these uncertainties
• Rupee drops 0.2% to 66.9463 per dollar