Key Points
Vikas Goel, MD & CEO, PNB Gilts, says interest rate cycles favour us, which basically means the cycle turns down which is what it is expected to do next year..
Given that yields are falling now, in the next calendar year, the entire market is expecting that the interest rate cycle is also expected to fall now going forward..
As there are more and more opportunities, we tend to be far more profitable then when the cycle is flat or when the cycle is an up cycle so essentially, it is a function of the amount of risk which we are taking which can be seen at least in public domain in the size of our balance sheet and the tenure of the securities which we are holding in that balance sheet, longer the tenure more sensitive they are to interest rate movements...
Our core business continues to be government securities trading, market making and underwriting the government's borrowing program so that is the major...
Now, apart from FX part what we intend to do going forward, is that the market looks very conducive for us for our core business going forward in 2024, both from viewpoint of index inclusion which is view agnostic, as well as from the fact that monetary policy might change from being very tight to maybe being more relaxed, and that will be favourable for our core business...
