Bond yields edged higher on Thursday as stronger rupee made India debt market less attractive for foreign investors. Indian rupee retreated from the lows of Rs 68/USD last seen in the year 2016 to claim the tag of Asia's third-best performing currency in the first three months of the year 2017. The rupee appreciated more than 3% against US Dollar so far in the year to Rs 65.45/USD which was closer to a 17-month high of 65.36, a level which was last seen on October 30, 2015.
In the global market, U.S. Treasury yields fell on Wednesday as investors reduced expectations that the Federal Reserve is likely to adopt a faster path in raising interest rates and any new fiscal stimulus is seen as unlikely in the near-term. Furthermore, oil prices recovered from losses chalked up the session before, but the market remained under pressure as bloated U.S. crude inventories and rising output dampen OPEC-led efforts to curb global production.
Back home, the yields on new 10 year Government Stock were trading 1 basis point higher at 6.82% from its previous close of 6.81% on Thursday.
The benchmark five-year interest rates were trading 1 basis point lower at 6.95% from its previous close of 6.96% on Thursday.