Traders have stepped up bearish bets on short-dated Indian debt, wagering the Reserve Bank of India will withdraw excess cash and lift yields. Data from the Clearing Corporation of India show overnight borrowings of the five-year benchmark topped 100 billion rupees (~$1bn) per day this month, roughly double early-August levels, as shorts borrow and sell the bond to repurchase later. The five-year has repeatedly been the most shorted issue this month — an uncommon pattern — and the debt-market se

Traders have stepped up bearish bets on short-dated Indian debt, wagering the Reserve Bank of India will withdraw excess cash and lift yields. Data from the Clearing Corporation of India show overnight borrowings of the five-year benchmark topped 100 billion rupees (~$1bn) per day this month, roughly double early-August levels, as shorts borrow and sell the bond to repurchase later. The five-year has repeatedly been the most shorted issue this month — an uncommon pattern — and the debt-market self-regulatory body says it is the shortest-tenor security on the monthly list of borrowable liquid securities. Rajiv Pawar, head of funds at Ujjivan Small Finance Bank, said markets are positioning for large-scale RBI cash withdrawal and that any sustained drain could sharply lift short-term yields.