Mumbai: Because more and more countries continue to borrow fewer than the market, their market loan costs fell 11 BPS to a two-month low of 6.87 percent at auction Tuesday when eight countries hit only Rs 12,100 Crore.
Market loans by countries so far in FY22 are 11 percent less than that in a comparable period in FY21, because 23 states and Delhi so far only collected Rs 2.18 lakh crore by opposing Rs 2.45 lakh crore in the period same.
At FY21, and this is 15 percent lower than the auction shown in advance, according to analysis with the ranking of maintenance.
The weighted average borrowing costs throughout the state and tenures at the latest weekly auctions declined to an eight-week low of 6.87 percent, or 11 bps from the past, the word treatment rating, added, the cost of funds was very high than.
At the beginning of the current fiscal because the results of the weighted average continued to 31 BPS higher than in April, and ruled around 6.9 percent since the third week of June.
But the spread between 10-year state bonds and secondary market results from 10 years G-seconds narrowed to 77 BPS, which was the lowest since mid-June and 6 bps lower than last week.
The main reason for the decline of the loan is that countries are less likely to increase more debt borrowed by the weight of FY21 (around Rs 8 Lakh Crore), showing their determination to return to the fiscal consolidation path, Head of Sabanvis, Head of Economist in the Care Rating .
However, other ranking agents ICRA linked 11 bps to the decline in results to the countries to reduce their loan tenor, the earliest was 10 years.
Also said the country borrowed the amount less indicated for the fourth week in a row because they were for liquidity of GST compensation.
Many countries have also taken advantage of financial accommodation provided by the RBI by short-term loan through special drawing facilities and the higher the way and the means of progress.
Between April 9 and July 21, the way and the means advancing loans by countries were 35 percent higher than last year at Rs 0.92 lakh Crore.
But since it has since been moderated since it can be associated with an increase in revenue inflows with locking easing and the resumption of economic and business activities gradually throughout the state, said Sabnavis.
Compared to last year, 15 states have borrowed less so far in the current finances and three countries were not forced to borrow loans at all.
While Madhya Pradesh has so far borrowed 78 percent less than last year, because the punjab was 32 percent down, Kerala (30 percent) and Gujarat (27 percent), Rajasthan (12 percent) and Tamil Nadu borrowed 9 percent less, according to carefully.
Karnataka, a heavy borrower, has not raised funds from the market so far in FY22, while it has raised Rs 15,000 Crore during a comparable period.
Likewise Odisha and Himachal also have not used market debt so far, according to Care.
But Uttar Pradesh borrowed 132 percent more than last year, Bengal (19 percent) and Telangana (18 percent).
Tamil Nadu, Maharashtra, Andhra, Rajasthan, and Telangana are the top five borrowers so far in FY22, accounting of around 60 percent of total loans.