Insecure Bond
On 7th July, a day after the Budget was presented, government bonds crashed by
5%-6%. The debt market was jittery about the fact that the Budget had proposed
a massive increase in deficit spending which will have to be financed by a
large increase in government borrowing. The bulk of the fiscal deficit for
FY10, pegged at 6.8%, will be funded by huge government debt. The Reserve Bank...
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