The Reserve of India (RBI) does not have a specific target for the government bond yield curve but focuses on its orderly evolution, Governor Shaktikanta Das said on Friday.
A yield curve is a line that plots yields or interest rates of government bonds having equal credit quality but different maturity dates.
The slope of the yield curve gives an indication of future interest rate changes and economic activity.
“We are focusing on orderly evolution of the yield curve. We use various policy instruments and market interventions from time to time to do that. We do not have a specific target of a yield curve,” Das told reporters after the post monetary policy press conference.
Das said the intervention is not just post the primary auction of government securities, but also through various measures like Government Securities Acquisition Programme (G-SAP), Open Market Operations (OMO), Operation Twist, and also through intervention in the secondary market.