RBI accepts nearly Rs 25,000 crore bids in g-sec buyback auction
government securities at the buyback auction, versus the notified amount of ₹25,000 crore. The amount offered by institutions was ₹33,201.4 crore.
This is the second such buyback operation done by the central bank this month. This auction, along with the one last week, was one of the most successful buyback auctions conducted by the RBI since it resumed such operations in May this year, after a gap of six years.
In its earlier auctions, the central bank accepted bids worth a smaller quantum than the total notified amount of the auction, likely because it and the government were uncomfortable with the price levels that banks were offering. The RBI is the manager of the government's debt.
Softer bond yields seem to be the reason why the recent buyback operations have been successful, as traders have made profits and are not selling the bonds to the government at a loss, dealers said.
Since January 2024, yields on the 10-year benchmark government bonds have eased 43 basis points. On January 1, the 10-year yield stood at 7.19% and as of Thursday, the 10-year yield closed at 6.76%
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