After a six week decline on the trot, the cost of borrowings for the states went up for the second week as their average debt rose by 9 bps to 7.65 per cent, according to the latest auction on Tuesday. The average cut-off went up by 10 bps to 7.56 per cent at the last auction, which was the first spike in the past six weeks. The Fed went ahead with its third 75 bps hike last week and said it will deliver at least two more to fight inflation, which is trending at over 40 years high, as a result of the spike in average cost. The weighted average cut-off of state debt increased by 9 bps to 7.65 per cent from 7.56 per cent in the last auction, with the average tenor remaining stable at 15 years. The 10 year Ge-Secs yield went up by 3 bps to 7.29 per cent on the other hand, according to Aditi Nayar, chief economist at Icra Ratings. The weighted average cut-off for the 10 year state debt increased by 12 bps to 7.67 per cent. The spread between the two increased to 38 bps from 29 bps. Fourteen states raised Rs 27,800 crore in the last auction of the second quarter, which took the cumulative issuance to Rs 2.8 lakh crore by 23 states during H 1, which is 11 per cent lower than the year-ago level and 31 per cent lower than the indicated amount of Rs 4 lakh crore, as per the Icra note. The states borrowed less from the market as they got more tax devolution at Rs 1.2 lakh crore in August from Rs 58,300 crore in July. While Chhattisgarh, Madhya Pradesh and Telangana did not participate in the latest auction, Andhra, Goa, Haryana, Kerala and Rajasthan borrowed Rs 2,700 crore less than indicated, even though they had indicated a combined borrowing of Rs 5,000 crore for this week. Maharashtra, Punjab and Tamil Nadu borrowed an additional 6,600 crore, while Manipur and Mizoram, which had not indicated their participation, issued Rs 100 crore each.