Bond yields traded higher on Thursday as Reserve Bank of India (RBI) has kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent. Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.
In the global market, U.S. government bond yield curve steepened as prices fell on the prospect of increased supply in longer-dated debt after the Treasury Department said it would borrow more in the third quarter than previously anticipated. Furthermore, oil prices were unchanged, struggling to hold onto five-month highs reached in the previous session, as fuel demand worries caused by a second wave of coronavirus infections outweighed declines in the U.S. dollar.
Back home, the yields on new 10 year Government Stock were trading 4 basis points higher at 5.86% from its previous close of 5.82% on Wednesday.
The benchmark five-year interest rates were trading 5 basis points higher at 5.03% from its previous close of 4.98% on Wednesday.