Centre's debt zooms to Rs 88 lakh crore in Q1

New Delhi: The total liabilities of the Central government increased to Rs 88,18,392 crore at end-June 2019 from Rs 84,68,086 crore at end-March 2019, and public debt accounted for 89.4 per cent of total outstanding liabilities at end-June 2019, the Finance Ministry said on Friday.

Nearly 28.9 per cent of the government's outstanding dated securities had a residual maturity of less than five years. The holding pattern indicates a share of 40.3 per cent for commercial banks and 24.3 per cent for insurance companies at end-March 2019, the Finance Ministry said releasing the Quarterly Report on Public Debt Management - Q1 FY20 (April to June 2019).

During the first quarter (Q1) of 2019-20, the Central Government issued dated securities worth Rs 2,21,000 crore as against Rs 1,44,000 crore in Q1 of the previous fiscal.

The weighted average maturity (WAM) of new issuances stood at 15.86 years in Q1 of 219-20 (14.18 years in Q4 of 2018-19). The weighted average yield (WAY) of issuances for the same quarter was 7.21 per cent compared to 7.47 per cent in Q4 of FY19.

During April-June 2019, the Central government did not raise any amount through the issuance of Cash Management Bills.

The net average liquidity injection by RBI under Liquidity Adjustment Facility (LAF) including Marginal Standing Facility (MSF) was Rs 17,599.3 crore during the quarter.

G-Sec yields have softened in Q1 of 2019-20 with the decrease in weighted average yield of primary issuances to 7.21 per cent, from 7.47 per cent in Q4 of 2018-19, reflecting the impact of several developments, namely reduction in the central bank's policy repo rate twice under the LAF by 25 basis points each, OMO purchase auction and a downward movement in the yield on US 10-year treasury bonds.

The yield on the 10-year benchmark G-Sec (7.26 per cent GS 2029) closed at 6.88 per cent on June 29, 2019.

Central government dated securities continued to account for a major share of total trading volumes in the secondary market, with a share of 86 per cent in total outright trading volumes in value terms during Q1 of 2019-20.