Bond yields up on US cues, auction details eyed
Tuesday, 27 April 2010
MUMBAI, Apr 26 (Reuters): Federal bond yields edged up in thin trade Monday morning tracking a rise in US yields but a sharp rise would be prevented by some value buying kicking in at higher yield levels.
At 9:20 am the yield on the benchmark 10-year bond was at 8.09 per cent, up from 8.06 per cent at close Friday.
The benchmark bond yield, which moves inversely to prices, has risen 24 basis points so far this month and dealers said this could lead to some value buying around 8.10-8.12 per cent levels.
Traders will watch the maturity details of this week's bond auction due to be announced later in the day. India is scheduled to borrow 120 billion rupees ($2.7 billion) between April 26 and 30, according to the central bank's issuance calendar.
US Treasury debt prices fell Friday as the US economic outlook brightened and fears of an acute debt crisis in Europe faded somewhat, tarnishing the safe-haven lustre of government debt.
Traders were wary of holding the 10-year on concerns volumes would start shifting away when a new bond is issued in that maturity.
India may issue new benchmark 10-year bonds by end-May or early-June to enable adequate time for the government to repay the loan, bond market dealers and analysts said.
At 9:20 am the yield on the benchmark 10-year bond was at 8.09 per cent, up from 8.06 per cent at close Friday.
The benchmark bond yield, which moves inversely to prices, has risen 24 basis points so far this month and dealers said this could lead to some value buying around 8.10-8.12 per cent levels.
Traders will watch the maturity details of this week's bond auction due to be announced later in the day. India is scheduled to borrow 120 billion rupees ($2.7 billion) between April 26 and 30, according to the central bank's issuance calendar.
US Treasury debt prices fell Friday as the US economic outlook brightened and fears of an acute debt crisis in Europe faded somewhat, tarnishing the safe-haven lustre of government debt.
Traders were wary of holding the 10-year on concerns volumes would start shifting away when a new bond is issued in that maturity.
India may issue new benchmark 10-year bonds by end-May or early-June to enable adequate time for the government to repay the loan, bond market dealers and analysts said.