New 10-Year Benchmark G-Sec Due on May 2, 2025
Why in the news
Bond dealers said in late April 2025 that a fresh 10-year benchmark paper would come the following week as the existing one aged.
Key facts
- Launch: expected May 2, 2025; RBI to announce auction securities on Monday.
- Borrowing: ₹8 lakh crore until September 2025, with ₹2.1 lakh crore through seven 10-year auctions.
| Benchmark | Detail |
|---|---|
| 7.10% GS 2034 | Issued April 2024; outstanding ₹1.80 lakh crore |
| 6.79% GS 2034 | Issued October 2024; outstanding ₹1.84 lakh crore |
Market impact
- Pahalgam attack and India-Pakistan tensions may add about 5 bps to borrowing costs.
- 10-year yield: 6.36% on Friday versus a low of 6.32% (CCIL data).
- Corporate bonds are priced at a spread over this benchmark; firms like bond funding in a dovish phase for faster transmission.
Market maturity
- Premium of new over old bonds: up to 15 bps before Covid, only 1-2 bps now.
Exam angle
- Outgoing benchmark: 6.79% GS 2034.
- Yield data: CCIL.