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RBI meets primary dealers as bond yields remain elevated
RBI convenes dealers amid high yields; cancelled a ₹11,000-cr auction and may intervene to stabilise debt markets.
The Reserve Bank of India held a meeting with standalone primary dealers today to assess sticky government bond yields and liquidity strains after recent forex interventions tightened cash. Dealers proposed RBI bond purchases and changes to auction mechanics to restore market functioning. The central bank cancelled a ₹11,000-crore seven-year auction earlier this week when bids priced yields above its comfort level. Traders said the RBI signalled it is monitoring conditions closely and may act if volatility persists, easing short-term pressure on yields and supporting fixed-income liquidity.