Bond yields traded higher on Monday, as traders took note of former RBI governor Raghuram Rajan’s statement that demonetisation and the Goods and Services Tax (GST) are the two major headwinds that held back India’s economic growth last year, asserting that the current 7% growth rate is not enough to meet the country’s needs.
In the global market, US Treasury yields fell on Friday with shorter-dated yields retreating from the highest levels in a decade, as investors scooped up safe-haven US government debt due to losses in equities worldwide on worries about economic growth in China and US interest rate hikes. Furthermore, Oil prices rose by about one percent after top exporter Saudi Arabia announced a cut in supply for December, seen as a measure to halt a market slump that had seen crude decline by 20 percent since early October.
Back home, the yields on new 10 year Government Stock were trading 4 basis points higher at 7.81% from its previous close of 7.77% on Friday.
The benchmark five-year interest rates were trading flat at its previous close at 7.66% on Friday.