Bond yields hardened after RBI announced that it would be conducting open market operations of Rs 10,000 crore, however further uptrend of yields is unlikely on account of prevailing caution ahead of August factory output numbers on Friday. Indian industrial output probably bounced in August from a four-month low, driven by solid growth in core industries, although a broader economic recovery is likely still some distance away
On the global front, U.S. short- and intermediate-dated Treasuries yields slipped on Wednesday after traders viewed the minutes from the Federal Reserve's latest policy meeting as suggesting a continued accommodative stance on monetary policy. Meanwhile, Brent crude futures held steady above $91 a barrel on Thursday, after rebounding from a 27-month low hit in the previous session as the U.S. dollar weakened on the possibility the Federal Reserve could hold off raising interest rates.
Back home, the yields on new benchmark 8.40%- 2024 bonds were trading 6 basis points higher at 8.47% from its previous close of 8.41% on Wednesday.
The benchmark five-year interest rate swaps were trading 4 basis points higher at 7.76% from its previous close of 7.72% on Wednesday.
The Government of India announced the sale of four dated securities for 15,000 crore on October 10, 2014, including (i) 8.27% Government Stock 2020 for a notified amount of Rs 3000 crore, (ii) 8.40% Government Stock 2024 for a notified amount of Rs 7000 crore, (iii) 9.20% Government Stock 2030 for a notified amount of Rs 2000 crore and lastly (iv) 9.23% Government Stock 2043 for a notified amount of Rs 3000 crore.