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Bond yields edge higher on Tuesday; weakness in rupee hurts

09 Sep 2014 Evaluate

Bond yields were trading higher after benchmark U.S. Treasuries yields stabilized on Monday after a study from the San Francisco Federal Reserve renewed concern there would be an early Federal Reserve rate increase. Meanwhile, weakness in the rupee was also hurting sentiment for debt, though fall in global oil prices capped the rise in yields.

Meanwhile, brent crude fell below $100 a barrel, the first time in nearly 15 months, before returning to close in three-digit territory but down on the day as fear of OPEC output cuts helped the market recover from weak Chinese and U.S. data.

Back home, the yields on new benchmark 8.40%- 2024 bonds were trading 1 basis point higher at 8.51% from its previous close of 8.50% on Monday.

The benchmark five-year interest rate swaps were trading 1 basis point higher at 7.99% from its previous close of 7.98% on Monday.

The Reserve Bank of India has announced the auction of 91 and 182 days Government of India Treasury Bills for notified amount of Rs 7,000 crore and Rs 5000 crore respectively. The auction will be conducted on September 10, 2014 using 'Multiple Price Auction' method.

The Reserve Bank will conduct a three day reverse repo variable rate auction for a notified amount of Rs 15,000 crore on September 5, 2014, Friday. The auction will be conducted between 3.00 PM and 3.30 PM as per the revised guidelines on Term Repo Auctions issued on February 13, 2014.

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