High yields sovereign papers may hit corporate bonds

High yields sovereign papers may hit corporate bonds

However, the central bank accepted Rs 26,853 crore in other three sets of long -term papers in excess of the planned auction size.

Synopsis

An unexplained skew in the yield curve has meant that lower-tenure sovereign bonds are generating nearly as much as the 10-year benchmark. In such a rate environment, project-financing corporate bonds — of longer tenures — could suffer. Unless, of course, the wrinkles are ironed out.

Mumbai: India’s bond buyers seem to have cut a long story short — to the evident disadvantage of companies selling debt locally. An unexplained skew in the yield curve has meant that lower-tenure sovereign bonds are generating nearly as much as the 10-year benchmark. In such a rate environment, project-financing corporate bonds — of longer tenures — could suffer. Unless, of course, the wrinkles are ironed out. “This needs addressing by the

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