Scheduled banks' investment in state, central govt securities rises by over Rs 1 lakh cr as on April 7: RBI data

Schedule bank’s investment in state, central govt securities rises by over Rs 1 lakh cr as on April 7: RBI data

Investment by scheduled banks in state and central government securities rose by over Rs 1 lakh crore, or around 2 percent for the week ended on April 7.

Scheduled banks held securities worth Rs 56.63 lakh crore as on April 7, which was up Rs 1.09 lakh crore from the previous fortnight on March 24, according to the Reserve Bank of India (RBI) data.

Similarly, in the other approved securities, the investment of scheduled banks increased to Rs 7,314.21 crore as on April 7, as compared to Rs 6,962.84 crore as on March 24.

State and central government securities also include Treasury Bills, Treasury Deposits, Treasury Savings Certificates and postal obligations.

Dealers are of the view that after the rate hike pause by the RBI, the sentiments of investors improved and they turned buyers of these securities leading to fall in yield.

The central bank in April monetary policy kept repo rate unchanged and surprised the market.

During the policy day, the yield on the 10-year benchmark bond touched 7.1469 percent levels then rebounded and ended at 7.2120 percent.

Prior to the RBI monetary policy, the yield on 10-year benchmark 7.26 percent 2032 bond were trading at 7.2750 percent, but after policy it remained in the range of 7.20-7.23 percent.

Today, the yield on 10-year bond closed at 7.2206 percent.