Interest, FX rates to stabilise: Treasury Secy.

Reuters: The ailing rupee currency and rising interest rates will stabilise with the $ 1 billion of inflows from the country’s latest 10-year sovereign bond, Treasury Secretary P.B. Jayasundera said on Tuesday.

Colombo sold the bond last week at a 5.875 per cent yield after being oversubscribed by more than 10 times, and the money is expected to flow into the market on Wednesday.

Jayasundera said $ 500 million of the bond would be kept aside to retire the country’s debut $ 500 million sovereign bond maturing in October, while the rest would be sold in the market.

“The market will be liquid and the market should be able to ease the interest rate. So I can assure you interest rates won’t go up,” he told Reuters in an interview. “Exchange rate pressure will also drop.”