Live Updates > Live Update Details
2025-10-28 17:12:07
[India's local government bond yield spread hits a five-month low] ⑴ India's local governments only completed two-thirds of the planned issuance through four auctions in October. The actual issuance volume was lower than expected, which directly lowered the bond supply. ⑵ The yield on 10-year bonds issued by Tamil Nadu was 7.16%, a significant drop from 7.26% of similar bonds on September 30. ⑶ During the same period, India's 10-year benchmark treasury bond yield fell only 3 basis points to 6.54%, causing the spread between local government bonds and treasury bonds to narrow to 62 basis points. ⑷ The spread not only continued to shrink from 70 basis points at the end of September, but also fell sharply from 100 basis points at the beginning of September, hitting the lowest level in five months. ⑸ Traders at state-owned banks pointed out that the improvement in local government fiscal conditions has led to a continued shortage of bonds. This structural change is supporting investor sentiment.
