Bond yields, extending its southbound journey, were trading lower on Wednesday, though further slide was restricted by higher crude prices. In absence of any positive triggers, dealers now would track rupee momentum for further cues. Meanwhile, RBI on Wednesday would be auctioning 91-days and 182-days Government of India Treasury Bills for notified amount of Rs 9,000 crore and Rs 6000 crore respectively.
On the global front, U.S. bond market traded in a narrow range on Tuesday, absorbing Federal Reserve Chair Janet Yellen's message that the U.S. economic recovery remains incomplete and early signs of a pick-up in inflation are not enough to accelerate anticipated interest rate increases. Meanwhile, brent crude climbed above $106 a barrel on Wednesday as data from China showed its economy grew faster than expected in the second quarter and the country's implied oil demand rose to its highest since the beginning of last year.
Back home, the yields on new 10 year Government Stock 2023 were trading two basis points lower at 8.72% from its previous close of 8.74% on Tuesday.
The benchmark five-year interest rate swaps were trading 1 basis point lower at 7.84% from its previous close of 7.85% on Tuesday.
The Government of India have announced the sale of Four dated securities for Rs 14,000 crore on July 18, 2014, including (i) 8.35% Government Stock 2022 for a notified amount of Rs 2,000 crore, (ii) 8.60% Government Stock 2028 for a notified amount of Rs 7,000 crore, (iii) 9.20% Government Stock 2030 for a notified amount of Rs 3000 crore and lastly (iv) 9.23% Government Stock 2043 for a notified amount of Rs 2000 crore.