The Central government issued dated securities worth Rs 2,88,000 crore in the third quarter of the financial year 2022 as against Rs 2,83,975 crore in the corresponding period during the last financial year while repayments were to the tune of Rs 75,300 crore.

The weighted average maturity of new issuances of dated securities was higher at 16.88 years in Q3 of FY22 as compared to 16.51 years in Q2 of FY22, according to the quarterly report on public debt management.

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From, October to December 2021, the Central Government did not raise any amount through the Cash Management Bills. The Reserve Bank did not conduct Open Market operations for government securities during the quarter. The net daily average liquidity absorption by RBI under Liquidity Adjustment Facility (LAF) including Marginal Standing Facility and Special Liquidity Facility was at Rs7,43,033 crore during the quarter.

The weighted average yield of primary issuances increased to 6.33 per cent in Q3 FY22 from 6.26 per cent in Q2 of FY22. The weighted average maturity of new issuances of dated securities was higher at 16.88 years in Q3 of FY22 as compared to 16.51 years in Q2 of FY22.

From October to December 2021, the Central Government did not raise any amount through the Cash Management Bills. The Reserve Bank did not conduct Open Market operations for government securities during the quarter. The net daily average liquidity absorption by RBI under Liquidity Adjustment Facility (LAF) including Marginal Standing Facility and Special Liquidity Facility was at Rs 7,43,033 crore during the quarter.

Total liabilities (including liabilities under the ‘Public Account’) of the government, as per provisional data, was Rs 128,41,996 crore at end-December 2021 as against Rs 125,71,747 crore at end-September 2021. This indicates a quarter-on-quarter increase of 2.15 per cent in Q3 FY22.

Public debt accounted for 91.60 per cent of total outstanding liabilities at the end-December 2021 as against 91.48 per cent in end-September 2021. Nearly 29.94 per cent of the outstanding dated securities had a residual maturity of fewer than 5 years.

The yields on Government securities hardened in the secondary market due to an increase in the supply of G-secs during the quarter like in the first and second quarters of FY22. However, the yields were supported by the decision of MPC to keep the policy repo rate unchanged at 4 per cent, to continue with an accommodative stance during the Q3 FY22.

In the secondary market, trading activities were concentrated in the 7-10 year maturity bucket during the quarter mainly because of more trading observed in the 10-year benchmark security. Private sector banks emerged as the dominant trading segment in the secondary market during the quarter.

On a net basis, foreign banks and primary dealers were net sellers while co-operative banks, FIs, insurance companies, mutual funds, public sector banks, private sector banks and ‘Others’ were net buyers. The ownership pattern of Central Government securities indicates that the share of commercial banks stood at 35.40 per cent in end-December 2021 as against 37.82 per cent in end-September 2021.