Bond yields were trading higher tracing a weaker rupee and higher US treasury yields overnight. On the currency front, following the decline in other emerging market currencies, Indian rupee was trading weak in data heavy week with February CPI and January factory output due on Wednesday, February WPI on Friday. CPI is broadly expected to be close to 9 percent and any number significantly below that expected to spark a rally in debt and rupee.
On the global front, US Treasuries yields rose to their highest levels in six weeks on Friday after jobs gains were stronger than expected in February, which could ease fears of an abrupt slowdown in economic growth and keep the Federal Reserve on track to reduce its monetary stimulus. Meanwhile, brent crude slipped towards $108 a barrel on Monday as data showing an unexpected fall in China's exports added to fears of a slowdown in the world's No. 2 economy, though geopolitical tensions in Ukraine and Libya limited the decline.
The yields on new 10 year Government Stock 2023 were 2 basis points higher at 8.83% from its previous close of 8.81% on Friday.
The benchmark five-year interest rate swaps were trading 3 basis points higher at 8.55% from its previous close of 8.52% on Friday.
The Reserve Bank of India has announced the auction of 182-days Government of India Treasury Bills for notified amount of Rs 6,000 and Rs 8000 crore respectively. The auction will be conducted on March 12, 2014 using 'Multiple Price Auction' method.