Bond yields traded lower on Wednesday as State Bank of India's (SBI) research report - Ecowrap has said that India’s real Gross domestic product (GDP) is expected to shrink by 10.9 percent in the current fiscal year (FY21). It had earlier estimated real GDP at (-) 6.8 percent for FY21. It estimates Q2 real GDP decline in the range of (-) 12 percent to (-) 15 percent, while Q3 GDP is seen between (-) 5 percent and (-) 10 percent. Q4 is expected to be in (-) 2 percent to (-) 5 percent range.
In the global market, U.S. Treasury yields on the longer end of the curve reversed course and fell on Tuesday after a Federal Reserve governor called for new accommodative efforts to help the economy overcome the impact of the coronavirus pandemic. Furthermore, crude oil futures rose after a more-than-expected draw in U.S. crude stockpiles and as solid U.S. factory data raised optimism of a post-pandemic economic recovery, boosting risk appetite among investors.
Back home, the yields on new 10 year Government Stock were trading 2 basis points lower at 5.92% from its previous close of 5.94% on Tuesday.
The benchmark five-year interest rates were trading 3 basis points lower at 5.17% from its previous close of 5.20% on Tuesday.
