The Reserve Bank of India (RBI) did not accept any bids in an auction to buyback government bonds, results released on Thursday showed.
The buyback included bonds maturing this financial year.
Investors offered bonds worth only 10% of the 300 billion rupees ($3.18 billion) New Delhi sought to buy through the buyback.
Traders cited ample banking liquidity as the reason for the tepid response.
“Banks already have ample surplus and are looking for avenues to park these funds, and hence there was hardly any interest from them,” a treasury official at a private bank said.
Bids were likely placed at prices higher than market levels, a private bank trader said.
New Delhi has bought back bonds worth 257 billion rupees so far in this financial year.
Comments