Bond yields traded lower on Wednesday even after India’s Industrial production grew 11.9 per cent in August mainly due to a low-base effect. The Index of Industrial Production (IIP) had contracted by 7.1 per cent in August 2020.
In the global market, Yields on the U.S. two-year Treasury note jumped to their highest level in more than 18 months on Tuesday, on concerns rising inflation may force the U.S. Federal Reserve to take action earlier than currently anticipated with a key report on consumer prices on Wednesday in focus. Furthermore, oil prices dropped, after a mixed finish in the previous session, amid worries that soaring coal and natural gas prices in China, India and Europe will stoke inflation and slow global growth, reducing oil demand.
Back home, the yields on new 10 year Government Stock were trading 1 basis point lower at 6.31% from its previous close of 6.32% on Tuesday.
The benchmark five-year interest rates were trading 1 basis point lower at 5.81% from its previous close of 5.82% on Tuesday.