Bond yields were trading lower on Friday even after India’s service sector activity improved in the month of February, as COVID-19 cases declined and restrictions were lifted. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index surged to 51.8 in February from 51.5 in January. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services -- also improved to 53.5 in February from 53.0 in January.
In global front, the U.S. Treasury yield curve reached its flattest level since March 2020 on Thursday as Federal Reserve Chairman Jerome Powell reiterated that he supports a 25-basis-point hike this month, and before Friday's highly anticipated February jobs report. Furthermore, oil prices rebounded as the disruption of Russian oil exports because of western sanctions outweighed the prospect of more Iranian supplies from a possible nuclear deal.
Back home, the yields on new 10 year Government Stock were trading 1 basis point lower at 6.81% from its previous close of 6.82% on Thursday.
The benchmark five-year interest rates were trading flat with its previous close of 6.11% on Thursday.