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Bond yields edge lower tracing fall of US counterparts

08 Apr 2013 Evaluate

Bond yields were trading lower since early deals on Monday tracing the drop of US treasury yields to their lowest level in Asian trade and also due to improved liquidity conditions.

On the global front, US 10-year Treasury yield hovered near its lowest level so far this year in Asian trade on Monday after weak jobs data released last week stirred worries that the economic recovery may be losing momentum. American employers hired at the weakest pace in nine months in March, data showed on Friday, a sign tax hikes that kicked in early this year could be stealing momentum from the economy. Meanwhile, Brent crude rose towards $105 per barrel on Monday as Japan's ambitious plan to stimulate the world's third largest economy is expected to enhance liquidity in the markets, although weak US jobs data kept a lid on gains.

Back home, the yields on 10-year 8.79% - 2021 bonds eased two basis points at 7.91% from its previous close of 7.93% on Friday.

The benchmark five-year interest rate swaps were down by 1 basis point each at 7.20% from its previous close.

The Reserve Bank of India has announced the auction of 91-day and 182-days Government of India Treasury Bills for notified amount of Rs 5,000 crore each. The auction will be conducted on April 10, 2013 using 'Multiple Price Auction' method.

Additionally, five State Governments, namely, Haryana, Himachal Pradesh, Meghalaya, Mizoram and Punjab, have offered to sell dated securities by way of auction for an aggregate amount of Rs 2,593 crore (Face Value).

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