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Our Bureau

Mumbai, July 24

Bond prices inched up as a reaction to the postponement and reduction of the Government securities auction, which will now be held on July 27.

Dealers said that since the announcement was made after market hours on Friday, bond prices reacted on Monday. The postponement of the auction, which was to be held between July 17 and July 25, will help primary dealers minimise losses in case there is a hike in the interest rates in the quarterly review of the credit policy on July 25, they said.

Market participants were not taking large positions ahead of the quarterly review of the credit policy. "If RBI hikes interest rates then the 10 year-yield could harden to 8.3 - 8.35 per cent, but if they are left untouched then the yield could ease to 8.1- 8.15 per cent," said a dealer at a private bank.

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