Indian issuers hold dollar bond plans amid demand for higher yields

Indian issuers including State Bank of India and Bank of Baroda have paused their dollar bond plans as investors demand higher spreads over US Treasuries amid rising supply expectations from India. HDFC Bank recently raised $750 million at 90 basis points over the benchmark, while Power Finance Corp raised $300 million at 105 basis points, signalling widening pricing. Banks, PSUs, and DFIs like NaBFID are likely to turn to dollar loan markets while waiting for bond conditions to cool, with NaBFID planning up to $1 billion in loans priced in the 6.5 to 7 percent range.