Rate cut hopes, inclusion in JPM index fuel ‘FOMO’ trades in GSecs
bond traders have suffered spent nights over the past year amid wild swings in US rate expectations, but India's sovereign debt players have bonded with bonds on fears of missing out after Mint Road sought to decelerate the rate-increase drive, while JPMorgan gave local debt the recognition it deserves through its inclusion on a globally tracked gauge.
In 2023, the value of total monthly trades in Indian government securities averaged ₹8.6 lakh crore, 40% higher than ₹ 6.2 lakh crore in the previous month, Clearing Corporation of India (CCIL) data showed. The uptick has continued in the current year, with the value of monthly trades from January to April at ₹8.7 lakh crore, the data — which counts April as the latest month — showed.
The data includes brokered deals, over-the-counter deals as well as trades on the official Negotiated Dealing System-Order Matching platform. In 2023, the value of daily trades averaged ₹42,768.25 crore, sharply higher than ₹30,469.25 crore a year ago. In the first four months of 2024, the value of daily average trades was at ₹45,085 crore, the data showed.
«Volumes don't shift from the range unless some new market participants are likely to join the group. When we are seeing a significant jump in the volume, that is largely because of the finalisation of India's inclusion in the bond index,» said Gopal Tripathi, head of treasury and capital markets at Jana Small Finance Bank. «If I'm a market player and I know that one year down the line, six months down the line, there will be new
