Bond yields traded higher on Wednesday, as sentiments remained on the sidelines with SBI’s report that the rupee may fall further against the US dollar, prompting the Reserve Bank to adopt ‘orthodox’ monetary policy like hike in interest rate to check depreciation of the domestic currency.
In the global market, US Treasury yields rose to three week highs on Tuesday after data showed that US manufacturing activity accelerated to a more than 14-year high in August, and on heavy corporate debt supply. Furthermore, Oil prices fell, partly reversing a strong jump from the previous day, as the impact of a tropical storm on US Gulf coast production was not as strong as initially expected.
Back home, the yields on new 10 year Government Stock were trading 2 basis point higher at 8.08% from its previous close of 8.06% on Tuesday.
The benchmark five-year interest rates were trading 5 basis points higher at 8.16% from its previous close of 8.11% on Tuesday.
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