India Eases Cash Curbs to Tame Surging Bond Yields
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India’s central bank said it will buy long-dated government debt after cash-supply curbs to support the rupee prompted a surge in yields. Bonds and shares of lenders jumped the most in four years.
The Reserve Bank of India will conduct open-market debt purchases of 80 billion rupees ($1.3 billion) on Aug. 23 and “thereafter calibrate them both in terms of quantum and frequency” based on market conditions, it said in a statement yesterday. The earlier liquidity-tightening steps must not “harden longer term yields sharply” and hurt lending, it said.