RBI Guv Allays FY27 Borrowing Fears, Urges Focus on Net Numbers

• RBI Governor Sanjay Malhotra addressed concerns over the government's gross borrowing target for FY27, emphasizing the net borrowing figure.
• Malhotra stated that net borrowing increased by only Rs 20,000 crore, growing slower than the overall budget, assuring a smooth borrowing program.
• The high gross borrowing of Rs 17.2 lakh crore is attributed to significant maturities lined up in FY27.
• Investor unease arose due to fears of a 'crowding out' effect, but Malhotra highlighted that GDP growth is expected to outpace budget growth.
• Despite RBI's assurances, bond yields rose by 10 basis points, with the 10-year benchmark bond yield closing at 6.7363 per cent, partly due to a lack of new liquidity measures.