India not planning to issue cash management bills as of now: officials

[NEW DELHI] The Indian government is not planning to issue cash management bills (CMBs) as of now, given that it has a comfortable cash balance, two officials with direct knowledge of the development told Reuters on Thursday.

Some traders had expected that India would soon issue these short-term debt instruments to help drain liquidity and manage its cash position amid an expected acceleration in government spending.

However, a senior official said there was "no discussion, no plans" when asked about the likelihood of issuing ultra-short CMBs.

Another official also denied that the government was planning to issue the short-term debt. "All those who are suggesting this, they are merely speculating," the second official said.

The officials declined to be identified because they were not authorised to talk to the media.

Reuters reported on Tuesday that the central bank would aim to drain money markets of excess liquidity, primarily through reverse repos, to counter inflationary pressures arising from higher government spending, citing policymakers.

REUTERS