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Bond yields trade range-bound in absence of major triggers

10 Oct 2012 Evaluate

Bond yields were trading range-bound in absence of major cues, as investors await the release of Index of Industrial production data on Oct 12 and September inflation data, key before RBI’s rate meeting on October 30.

On the global front, US Treasuries were steady in Asian trade on Wednesday, as continued fears of slowing global growth kept demand for fixed-income assets firm. Meanwhile, Brent crude slipped near $114 on Wednesday as cloudy economic outlook offset fears about disruptions to Middle East oil supply on account of conflict between Turkey and Syria escalated.

The yields on 10-year benchmark 8.79% - 2021 were trading 1 basis point higher at 8.15% from its previous close of 8.14%.

The benchmark five-year interest rates were trading flat at its previous close of 7.58%.

The Government of India have announced the sale (re-issue) of three dated securities for  Rs 13,000 crore on October 12, 2012, which includes (i) ‘8.07 percent Government Stock 2017-JUL’ for a notified amount of  Rs 3,000 crore (nominal) through price based auction; (ii) ‘8.15 percent Government Stock 2022’ for a notified amount of  Rs 7,000 crore (nominal) through price based auction; and (iii) ‘8.97 percent Government Stock 2030’ for a notified amount of  Rs 3,000 crore (nominal) through price based auction. The auctions, which will be conducted using uniform price method, will be conducted by the Reserve Bank of India, Mumbai Office, Fort, and Mumbai on October 12, 2012 (Friday).

The Reserve Bank of India has announced the auction of 91-day and 182-day Government of India Treasury Bills for notified amount of Rs ,000 crore each respectively. The auction will be conducted on October 10, 2012 using 'Multiple Price Auction' method.

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