Bond yields edged higher for third consecutive session on Friday tailing the weakness of Indian currency after fiscal deficit number touched 76% of the full year’s budget estimate in the first half of current fiscal. Meanwhile, cautiousness ahead of Rs 14,000 crore debt sale auction, which is to be held later in the afternoon, also weighed on the sentiment.
On the global front, U.S. Treasury prices dipped slightly on Thursday as a surprisingly strong report on Midwest business activity soothed worries about sluggish fourth-quarter growth after the recent federal government shutdown. Meanwhile, Brent futures traded around $109 a barrel on Friday, recovering from an overnight fall after an official survey showed manufacturing in China, the world's second-biggest oil consumer, expanded in October at its fastest pace in 18 months.
Back home, the yields on 10-year 7.16% - 2023 bonds, were trading 2 basis points higher at 8.64% from its previous close of 8.62% on Thursday.
The benchmark five-year interest rate swaps were trading 1 basis point higher at 8.19% from its previous close of 8.18% on Thursday.
The Government of India have announced the sale (Re-issue) of four dated securities for Rs 14,000 crore on November 1, 2013 (i) “8.12 percent Government Stock 2020” for a notified amount of Rs 4,000 crore (nominal) through price based auction; (ii) “8.28 percent Government Stock 2027” for a notified amount of Rs 6,000 crore (nominal) through price based auction;(iii) “ 9.20 percent Government Stock 2030” for a notified amount of Rs 2,000 crore (nominal) through price based auction, and (iv) “8.83 percent Government Stock 2041” for a notified amount of Rs 2,000 crore (nominal) through price based auction. The auctions will be conducted using uniform price method. The auctions will be conducted by the Reserve Bank of India, Fort, Mumbai on November 1, 2013 (Friday).
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