‼️ 🇮🇳 Bets against India’s short-term government bonds are building as traders position for the Reserve Bank of India to drain the banking system’s roughly ₹11 trillion liquidity surplus. Overnight short positions in the five-year benchmark pushed daily borrowing above ₹100 billion ($1 billion) at the start of the month—about double early-August levels—making it the market’s most-shorted bond on several occasions, an unusual development. The move signals growing expectations that sustained RBI liquidity absorption will lift short-end borrowing costs and push yields higher.
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