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Bond yields edge lower tailing Rupee's appreciation on better than expected Q2 GDP data

02 Dec 2013 Evaluate

Bonds yields edged lower tailing the strength of Indian currency after the economy grew by a higher-than-expected 4.8% in the September quarter from 4.4% recorded in the previous quarter. Meanwhile, positive October factory output data also led to some gains of bonds. On the macro-front, in a highest reading since April, the HSBC Purchasing Managers’ Index (PMI), snapped its three consecutive months’ declining streak and climbed from 49.6 in the previous month to 51.3 in November.

On the global front, US Treasuries ended flat after a shortened trading session on Friday as month-end buying offset some earlier weakness and as investors turned their focus to economic data next week expected to bring new clues over Federal Reserve policy. Meanwhile, brent crude edged higher above $110 a barrel on Monday as Chinese industrial activity clung to an 18-month high and on continued supply disruptions in Libya.

Back home, the new 10 year Government Stock 2023 was trading 2 basis points lower at 8.72% from its previous close of 8.74% on Friday. The yields on 10-year 7.16% - 2023 bonds, were trading 1 basis point lower at 9.03% from its previous close of 9.04% on Friday.

The benchmark five-year interest rate swaps were trading 3 basis points lower at 8.31% from its previous close of 8.34% on Friday.

The Reserve Bank of India has announced the auction of 91 and 182 days Government of India Treasury Bills for notified amount of Rs 6,000 crore each. The auction will be conducted on December 04, 2013 using 'Multiple Price Auction' method.

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