Bond yields edged lower on Tuesday, as the federal government will borrow a lower-than-expected Rs 2.88 lakh crore in the first six months of the next financial year, boosted investors demand.
In the global market, U.S. Treasury yields rose and the yield curve flattened on Monday following a lackluster two-year note auction, in a test of investors' appetite following last week's strong run spurred by nervousness about a global trade war. Furthermore, oil prices rose, pushed up by concerns that tensions in the Middle East could lead to supply disruptions.
Back home, the yields on new 10 year Government Stock were trading 25 basis point lower at 7.37% from its previous close of 7.62% on Monday.
The benchmark five-year interest rates were trading 13 basis point lower at 7.32% from its previous close of 7.45% on Monday.