Bond yields traded higher on Monday as a monthly survey showed India's manufacturing sector activity growth accelerated to a three-month high in May, driven by demand strength, infrastructure projects and new business gains, even amid inflationary pressures. The seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) posted 55.0 in May, above the April reading of 54.7, indicating the strongest improvement in the sector's health in three months.
In the global market, US Treasury yields were little changed on Friday as investors closely monitored Middle East developments on the final trading day of the month, amid signs that a lasting U.S.-Iran ceasefire agreement could now be in sight. Furthermore, oil prices jumped on Monday after sharp weekly losses, as renewed fighting between the U.S. and Iran over the weekend and Israel’s deeper push in Lebanon heightened concerns over Middle East supply risks.
Back home, the yields on new 10 year Government Stock were trading 02 basis points higher at 7.02% from its previous close of 7.00% on Friday.
The benchmark five-year interest rates were trading 02 basis points higher at 6.84% from its previous close of 6.82% on Friday.