Bond yields traded higher as SBI Research in its latest report has scaled up its projections for the economy, projecting gross domestic product (GDP) to contract 7.4 per cent during the current financial year (FY21) compared to its earlier forecast of a 10.9 per cent fall.
In the global market, Treasury yield curve steepened slightly on Wednesday after the Federal Reserve at the conclusion of its monthly meeting said it would maintain its current bond-buying policy until significant progress in the U.S. economic recovery is made. Furthermore, oil prices hit a nine-month high after U.S. government data showed that crude stockpiles fell last week and on optimism over a coronavirus relief package in the United States.
Back home, the yields on new 10 year Government Stock were trading 1 basis point higher at 5.95% from its previous close of 5.94% on Wednesday.
The benchmark five-year interest rates were trading flat with its previous close of 5.09% on Wednesday.