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Bonds yields stuck in tight range ahead of key GDP, fiscal deficit data

28 Nov 2013 Evaluate

Bonds yields were trading largely range-bound as dealers preferred staying light ahead of September-quarter GDP data and October fiscal deficit data on Friday. Further, prevailing caution ahead of Rs 14,000 crore worth auction has also been factored in. However, bond prices could slip lower in the session after country's economic affairs secretary Arvind Mayaram underscored that inclusion of Indian bonds into global debt indices is not an urgent concern.

On the global front, U.S. Treasury prices added losses on Wednesday after the Treasury sold $29 billion in seven-year notes to relatively low demand in the government's final sale of $96 billion in new coupon-bearing debt this week. Meanwhile, brent futures held above $111 a barrel on Thursday on worries that supply from OPEC member Libya will continue to remain disrupted as winter oil demand increases, however a bigger-than-expected rise in US crude stocks limited the further upside of the commodity.

Back home, the yields on 10-year 7.16% - 2023 bonds, were trading 1 basis point lower at 8.68% from its previous close of 8.69% on Wednesday. The new 10 year Government Stock 2023 also was trading 2 basis points lower at 8.98% from its previous close of 9.00% on Wednesday.

The benchmark five-year interest rate swaps were trading 2 basis points lower at 8.34% from its previous close of 8.36% on Wednesday.

Government of India announce the sale of four dated securities for Rs 14,000 crore on November 29, 2013, which include, (i) 8.12 % Government Stock 2020 for a notified amount of Rs 3000 crore, (ii) 8.24 % Government Stock 2027 for a notified amount of Rs 6000 crore, (iii) 9.20 % Government Stock 2030 for a notified amount of Rs 2000 crore and (iv) 8.83 % Government Stock 2041 for  notified amount of Rs 3000 crore,  which will be available in auctions that will be conducted using uniform price method.

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