India’s Treasury Bill Auction Sees Higher Yields Across Tenors

The Reserve Bank of India (RBI) conducted a major treasury bill auction this week, selling a total of 290 billion rupees across three maturities. The auction witnessed slightly higher yields compared to the previous round, signaling cautious investor sentiment amid evolving liquidity conditions.  

The government sold 80 billion rupees of 364-day treasury bills at a cut-off price of 94.7280 rupees, with yields rising to 5.5807 percent from 5.5387 percent in the last auction. Similarly, 120 billion rupees of 182-day bills were sold at 97.3132 rupees, with yields climbing to 5.5371 percent from 5.4755 percent earlier. For the shortest tenor, 91-day bills worth 90 billion rupees were sold at 98.6932 rupees, with yields increasing to 5.3110 percent from 5.2579 percent.  

Key Highlights  
364-day bills worth 80 billion rupees sold at 94.7280 rupees, yield at 5.5807 percent  
182-day bills worth 120 billion rupees sold at 97.3132 rupees, yield at 5.5371 percent  
91-day bills worth 90 billion rupees sold at 98.6932 rupees, yield at 5.3110 percent  
Yields rose modestly across all tenors compared to the last auction  
Reflects tighter liquidity and cautious investor sentiment  

Final Takeaway  
India’s latest treasury bill auction underscores rising short-term yields as liquidity conditions tighten. The RBI’s calibrated approach ensures government borrowing needs are met while maintaining market stability, with investors closely tracking yield movements for signals on monetary policy direction.  

Sources: Reuters, Reserve Bank of India