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Bond yields edge lower on value buying activities on Tuesday

05 May 2015 Evaluate

Bond yields edged lower on Tuesday on account of value buying activities by participants. The yields had edged higher on last trading session on Thursday as trimmed their holdings after auction supplies hit the market ahead of the long weekend. Money markets were shut for trade on May 1 and May 4 on account of ‘Maharashtra Day’ and ‘Buddha Pournima’ respectively.

On the global front, US treasuries prices fell on Monday, with the long end of the curve suffering the most and the sell-off and extending the prior week’s declines amid low trading volumes because of holidays in Tokyo and London. Meanwhile, Brent crude oil futures slipped towards $66 a barrel on Tuesday, falling from a 2015 high, as Saudi Arabia considered halting bombing in Yemen to allow the delivery of aid, which eased concerns about oil supply from the Middle East.

Back home, the yields on 10 year Government Stock was trading 1 basis point lower at 7.85% from its previous close of 7.86% on Thursday.

The benchmark five year swap rate was trading 1 basis point lower at 7.17% from its previous close of 7.18% on Thursday.

The Reserve Bank of India has announced the auction of 91 and 182 day Government of India Treasury Bills for notified amount of Rs 8,000 and Rs 6000 crore respectively. The auction will be conducted on May 06, 2015 using 'Multiple Price Auction' method.

The Government of India has announced the sale (new/re-issue) of four dated securities for Rs 16,000 crore on May 08, 2015, including (i) 7.68% GS 2023 for a notified amount of Rs 3000 crore, (ii) New Security maturing on March 19, 2030 for a notified amount of Rs 7000 crore, (iii) 8.24% GS 2033 for a notified amount of Rs 3000 crore and lastly (iv) 8.17% GS 2044 for a notified amount of Rs 3000 crore.

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