Bond yields were treading steady as market-men looked for fresh triggers to initiate any position. Besides, many investors remained on the sidelines and refrained from any buying activity ahead of the upcoming monetary policy meeting on September 29, 2015. RBI Governor Raghuram Rajan left the main rate unchanged at 7.25% in August after three reductions in 2015, rebuffing calls from the government to cut borrowing costs. Finance Minister Arun Jaitley has repeated the need for lower interest rates and said sectors including real estate and infrastructure were anxiously waiting for the central bank to ease monetary policy.
In the global market, U.S. Treasuries prices slipped on Wednesday as data showing an expected slight fall in euro zone manufacturing growth reduced anxiety about global growth that was briefly heightened by a dismal reading on China's economy. Furthermore, Oil prices pared some losses on Thursday after sharp falls overnight on an unexpectedly large buildup in U.S. gasoline stocks and seasonally tepid demand.
Back home, the yields on new 10 year Government Stock were trading steady at its previous close of 7.71%.
The benchmark five-year interest rates edged 1 basis point lower at 7.86% from its previous close of 7.87%.