Bond yields traded higher on Tuesday as India's central bank announced a host of measures to inject liquidity in the banking system, including bond purchases and dollar/rupee swaps. The Reserve Bank of India will buy government bonds worth Rs 60,000 crore ($6.96 billion) in three tranches and conduct a 56-day variable rate repo auction worth Rs 50,000 crore on February 7.
In the global market, U.S. Treasury yields fell on Monday as investors sought out safe-haven assets amid a massive stock market sell-off. Furthermore, Oil prices retreated on Monday after the Trump administration pulled back from sanctions threats against Colombia over illegal immigration, alleviating concern about oil supply disruptions.
Back home, the yields on new 10 year Government Stock were trading 7 basis points higher at 6.78% from its previous close of 6.67% on Monday.
The benchmark five-year interest rates were trading 8 basis points higher at 6.73% from its previous close of 6.61% on Monday.