Bond yields edged lower on Wednesday, on sustained demand from corporates and banks. However, gains remained capped with trade deficit widening to its highest in nearly three years in October, as export growth contracted for the first time after more than a year. The trade deficit widened to $14.02 billion last month from $8.98 billion in September. Merchandise exports for October fell 1.12 percent from a year earlier to $23.1 billion, dropping for the first time since August 2016.
In the global market, U.S. Treasury two-year note yields touched a nine-year high on Tuesday, while those on long-dated debt fell as the yield curve flattened for a second straight day and investors braced for the next tightening by the Federal Reserve in December. Furthermore, Oil prices tumbled, continuing Tuesday's slide after the International Energy Agency cast doubts over the past months' narrative of tightening fuel markets.
Back home, the yields on new 10 year Government Stock were trading 2 basis points lower at 7.03% from its previous close of 7.05% on Tuesday.
The benchmark five-year interest rates were trading 2 basis points lower at 6.86% from its previous close of 6.88% on Tuesday.