The finance ministry has reported that the total amount of money the government owes, known as gross liabilities, went up to ₹171.78 lakh crore by the end of March 2024. This is an increase from ₹166.14 lakh crore at the end of December. This means that in the last quarter of the financial year 2023-24, there was a 3.4% increase in the amount of money the government owes.
Breakdown of Liabilities
According to the public debt management quarterly report for January to March 2024, a large portion of the government’s total liabilities, about 90.2%, was in the form of public debt during this period.
Factors Affecting Indian Domestic Bonds
The report also mentioned that the yield or return on Indian domestic bonds decreased during the quarter. This was due to factors such as a lower-than-expected borrowing plan announced in the interim budget, adjustments to the fiscal deficit, and steady inflation. Additionally, foreign portfolio investment inflows also played a role in influencing the bond yields.
Volatility in US Treasury Yields
In contrast, the report highlighted that US treasury yields were unstable during the quarter, largely impacted by actions of the Federal Reserve, inflation rates, and employment data. The 10-year US treasury yields reached a high of 4.33% during this period.
Changes in Yield Rates
The weighted average yield, which represents the average return on investments, decreased to 7.19% in the fourth quarter of 2023-24 compared to 7.37% in the third quarter. This change was attributed to new bond issuances during this period.
Overall, the report provides insights into the government’s financial liabilities, the performance of domestic and international bond markets, and the factors influencing these financial indicators.