Bond yields edged lower on Thursday as falling oil prices eased concern that inflation will quicken soon. The central bank, which has cut benchmark interest rates three times this year, has kept an inflation target of 6 percent by January. Some support also came with pick-up in monsoon rains that spurred optimism that food costs will remain in check.
In the global markets, US Treasury yields hit their lowest levels in nearly two weeks on Wednesday after another round of disappointing U.S. corporate reports drove safe-haven buying, while uncertainty ahead of next week's Federal Reserve meeting capped gains. Furthermore, Brent crude slumped 1.6 percent on Wednesday and retreated 12 percent in July as an unexpected increase in U.S. stockpiles exacerbated a glut.
Back home, the yields on 10 year Government Stock was trading 1 basis point lower at 7.81% from its previous close of 7.82% on Wednesday.
The benchmark five year yields were trading 1 basis point lower at 7.99% from its previous close of 8.00% on Wednesday.
The Government of India have announced the sale (new/re-issue) of four dated securities for Rs 14,000 crore on July 24, 2015 (i) “7.35 percent Government Stock 2024” for a notified amount of Rs 2,000 crore (nominal) through multiple price based auction; (ii) “7.88 percent Government Stock 2030” for a notified amount of Rs 6,000 crore (nominal) through multiple price based auction;(iii) “7.95 percent Government Stock 2032” for a notified amount of Rs 3,000 crore (nominal) through multiple price based auction, and (iv) “8.17 percent Government Stock 2044” for a notified amount of Rs 3,000 crore (nominal) through multiple price based auction. The underwriting auctions will be conducted using multiple price based auction method on July 23, 2015. The underwriting commission will be credited to the current account of the respective PDs at the RBI, Fort, Mumbai on the date of issue of securities.