Bond yields edged lower on Friday, on sustained demand from corporates and banks. However, gains remained capped as traders remained cautious ahead of a weekly auction of notes today and as state governments plan to raise a higher amount of funds through bonds in second quarter of this financial year.
In the global market, U.S. Treasury yields edged higher on Thursday but held near one-month lows as fears about trade wars harming global growth kept up demand for safe haven bonds, while month- and quarter-end rebalancing added to bond buying. Furthermore, Oil prices fell amid concerns about trade frictions between the United States and other major economies, although crude market conditions remain tight due to supply disruptions and generally high demand.
Back home, the yields on new 10 year Government Stock were trading 5 basis points lower at 7.89% from its previous close of 7.94% on Thursday.
The benchmark five-year interest rates were trading 2 basis points lower at 7.96% from its previous close of 7.98% on Thursday.