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Inflation and lockdown worries weigh on G-secs; yields rise 10 bps SECTIONS Share Synopsis The move came on a day when the Reserve Bank of India conducted its first government securities acquisition programme (G-SAP), a mechanism to keep rising yields under check. Shutterstock.com Related MUMBAI: The benchmark bond yield surged Thursday pulling prices down as an unexpected wholesale price rise coupled with an estimated economic cost of localised lockdown weighed on investor sentiment. The move came on a day when the Reserve Bank of India conducted its first government securities acquisition p...

RBI is in uncharted territory with quantitative easing Premium Share Via Read Full Story Without saying so, the Reserve Bank of India (RBI) has embarked on quantitative easing (QE). It has given it a fancy new name: Government Securities Acquisition Programme (GSAP), which has a promise of becoming meme-worthy if pronounced as G-zap. What exactly is RBI hoping to zap or obliterate? Well, it wants you to perish the thought of the yield on government securities going above, say, 6.25%. It wants to put a ceiling on market participants’ expectations. This might be harder than imagined. You can�...

Monetary Policy with short-term, narrow goals can destroy credibility in the long run

In its effort to manage the yield curve, the RBI must not get entangled into a QE trap