Bond yields traded lower on Tuesday as Reserve Bank of India (RBI) in its latest data on Outward Foreign Direct Investment (OFDI) for December 2021 has showed that outward foreign direct investment (FDI) by Indian companies fell by over 8 per cent to $2.05 billion in December 2021 in the current fiscal. The domestic companies had invested $2.23 billion in their overseas joint ventures and fully-owned subsidiaries during December 2020 in the previous financial year.
In the global market, the benchmark U.S. 10-year Treasury yield rose to its highest level in almost two years on Monday, as investors increasingly expect the Federal Reserve will begin its tightening policy with an interest rate hike as soon as March. Furthermore, oil prices rose after two days of losses, with some risk appetite returning as the market awaited clues from the U.S. Federal Reserve chairman on potential rate rises and as some oil producers continued to struggle to beef up output.
Back home, the yields on new 10 year Government Stock were trading 2 basis points lower at 6.57% from its previous close of 6.59% on Monday.
The benchmark five-year interest rates were trading 2 basis points lower at 6.01% from its previous close of 6.03% on Monday.