Bond yields were trading lower tailing the fall in global crude oil prices, while prevailing caution ahead of the release of crucial macro-economic data such as July industrial output and August Retail inflation also was aiding sentiment for yields. The street expects Industrial production to grow 1.8% from a year earlier in July, slower than June's 3.4% increase, while India's consumer price inflation, closely tracked by the Reserve Bank of India is expected to edge lower to 7.80% in August from July's 7.96%.
On the global front, U.S. Treasuries yields edged higher on Wednesday, with benchmark and longer-dated yields rising the most, after traders sold off debt to make way for new supply and continued to anticipate a more hawkish statement from the Federal Reserve next week. Meanwhile, brent crude edged higher to stay above $98 a barrel on Thursday amid geopolitical concerns in the Middle East, although worries about ample supply and weak demand that dragged prices to 17-month lows in the previous session kept a lid on gains.
Back home, the yields on new benchmark 8.40%- 2024 bonds were trading 2 basis points lower at 8.52% from its previous close of 8.54% on Wednesday.
The benchmark five-year interest rate swaps were trading steady at its Wednesday’s close of 8.02% on Wednesday.