Bond yields edged lower on Thursday as investors continue to bet on a rate cut next week and bank deposits keeping pouring in, easing liquidity concerns. However, gains remained capped amid a sharp rise in crude oil prices after the OPEC reached a deal yesterday to cut output and ease a supply glut.
In the global market, U.S. Treasury yields rose on Wednesday as the Organization of the Petroleum Exporting Countries (OPEC) agreed to its first output cuts since 2008, sending oil prices more than 8 percent higher and boosting expectations of higher inflation. Furthermore, oil shot up over 10 percent after producer club OPEC and Russia cut a deal to reduce output to drain a global supply glut, but analysts warned prices could recede as other producers stand ready to fill the gap.
Back home, the yields on new 10 year Government Stock were trading 3 basis points lower at 6.22% from its previous close of 6.25% on Wednesday.
The benchmark five-year interest rates were trading 2 basis points lower at 6.18% from its previous close of 6.20% on Wednesday.