Bond yields ended lower on Monday, as India’s inflation based on wholesale price index (WPI) jumped to 12.54% in the month of October as against 10.66% in September. The annual rate of inflation is 12.54% (Provisional) for the month of October 2021 as compared to 1.31% in October 2020. The high rate of inflation in October 2021 is primarily due to rise in prices of mineral oils, basic metals, food products, crude petroleum & natural gas, chemicals and chemical products etc. as compared the corresponding month of the previous year.
In the global market, selling in U.S. Treasury markets paused on Friday as data showed consumer sentiment plunged to a 10-year low on inflation worries, leaving traders trying to gauge the pace of future central bank interest rate hikes. Furthermore, crude oil prices skidded, under pressure from expectations of higher supplies and weakening demand.
Back home, the yields on new 10-year Government Stock were ended 2 basis points lower at 6.34% from its previous close of 6.36% on Wednesday.
The benchmark five-year interest rates were ended 3 basis points lower at 5.80% from its previous close of 5.83% on Friday.