Bond yields were trading flat on Wednesday after International Monetary Fund’s (IMF) Asia and Pacific Department’s Acting Director Anne-Marie Gulde-Wolf said that the surge in oil prices due to the Ukrainian war has pushed up inflation in India, which needs monetary tightening and measures to address structural weaknesses to improve growth potential. She said according to estimates, the country's economy is likely to grow at 8.2 per cent in 2022-23, down 0.8 per percentage points.
On the global front, treasury yields slid on Tuesday as uncertainties surrounding the war in Ukraine and Federal Reserve efforts to bring down inflation kept investors cautious ahead of an expected hike in interest rates next week. Furthermore, oil prices extended gains as geopolitical tensions simmered with Russia warning of gas supply cuts to Poland and Bulgaria while hopes of Chinese economic stimulus buoyed oil demand outlook.
Back home, the yields on new 10 year Government Stock were trading flat with its previous close of 7.05% on Tuesday.
The benchmark five-year interest rates were trading 1 basis point higher at 6.59% from its previous close of 6.58% on Tuesday.