Bond yields traded lower on Tuesday, as sentiments remain positive as Ratings agency Crisil in its half-yearly report on credit movements has said that system wide non-performing asset (NPA) ratios will improve by 180 basis points (bps) to 8.5 percent in March 2020 from FY19 levels on the back of moderation in slippages coupled with recoveries from the bankruptcy resolutions.
In the global market, the US Treasury market posted its biggest one-day sell-off in three months on Monday, as encouraging data on manufacturing activity in the world's two biggest economies spurred some investors to scale back their holdings of safe-haven bonds. Furthermore, oil prices rose to fresh 2019 highs, supported by firm Chinese economic data that eased demand concerns, the possibility of more sanctions on Iran and further Venezuelan supply disruptions.
Back home, the yields on new 10 year Government Stock were trading 6 basis points lower at 7.29% from its previous close of 7.35% on Friday.
The benchmark five-year interest rates were trading 5 basis points lower at 6.88% from its previous close of 6.93% on Friday.