Bond yields edged a little lower as the OMO announcement was largely discounted by the market, which was disappointed over the central bank's warning of little room for further policy easing in monetary policy statement ‘2013-14’.
Consistent with the stance of monetary policy and based on the current assessment of prevailing and evolving liquidity conditions, the Reserve Bank has decided to conduct Open Market Operations by purchasing the government securities for an aggregate amount of Rs 10,000 crore on May 7, 2013
On the global front, US Treasuries yields surged on Friday after employers added more jobs than expected in April, adding to hopes the economy is not slowing as badly as feared. Meanwhile, Brent futures rose to their highest in nearly a month, above $105 per barrel on Monday, as an Israeli air strike on a Syrian military facility over the weekend stoked worry over the risk of disruption to supplies from the Middle East.
Back home, the yields on 10-year 8.79% - 2021 bonds were trading 1 basis point lower at 7.73% from its previous close of 7.74% on Friday.
The benchmark five-year interest rate swaps were trading 2 basis points higher at 6.91% from its previous close of 6.89% on Friday.
The Reserve Bank of India has announced the auction of 91-days and 182 days Government of India Treasury Bills for notified amount of Rs 5,000 crore each. The auction will be conducted on May 8, 2013 using 'Multiple Price Auction' method.
Additionally, six State Governments have offered to sell dated securities by way of auction for an aggregate amount of Rs 4,100 crore (Face Value) on May 7, 2013.
