Bond yields were treading water on Thursday as traders await US nonfarm payroll data due on Friday and India’s inflation data next week for further triggers. The yields recovered from previous sessions’ sharp drubbing after central bank surprised with a 25 basis points repo rate cut. Giving its affirmation to the fiscal consolidation measures announced by the government in the Budget, the Reserve Bank of India (RBI) slashed repo rate by 25 basis points or 0.25% to 7.5%.
On the global front, U.S. Treasuries prices were mostly flat on Wednesday after a weaker-than-expected reading on U.S. private payrolls growth contrasted with stronger-than-expected U.S. services sector data and created uncertainty ahead of Friday's U.S. jobs report. Meanwhile, brent crude was flat on Thursday, managing to hold above $60 a barrel as investors brushed aside bearish US inventories data to focus on the lack of a deal in talks over Iran nuclear programme.
Back home, the yields on new 10 year Government Stock 2023 were trading steady at Wednesday’s close of 7.96%.
The benchmark five-year interest rate swaps were trading 1 basis point lower at 6.99% from its previous close of 7.00% on Wednesday.
The Reserve Bank of India will conduct 8 day variable rate reverse repo auction for a notified amount of Rs 30,000 crore on March 5, 2015, Thursday. The auction will be conducted between 12.00 pm and 12.30 pm as per the revised guidelines on Term Repo Auctions issued on February 13, 2014.
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