The Hindu Business Line : Bond prices up on ample liquidity

Bond prices rose as traders drew comfort from the surplus liquidity in the system. Total traded volumes on the order matching system were at Rs 11, 825 crore (Rs 9,275 crore). Dealers said that there was confidence that substantial liquidity would remain in the system even after the final tranche of the Cash Reserve Ratio hikes come into effect by May 24. Bond yields have eased by around 30 basis points since the annual monetary Policy. “There is a scheduled auction of around Rs 10,000 crore this week apart from the regular Treasury bill auctions but liquidity remains comfortable. If the 10-year yield crosses 7.75 per cent it could even ease up to 7.60 per cent,” said a dealer at a private bank. Market participants said that Government spending could have caused an increase in surplus liquidity. The 8.24 per cent-10 year-2024 opened at Rs 102.75 (7.83 per cent YTM) and closed at Rs 103.05 (7.79 per cent), against the previous close at Rs 102.74 (7.84 per cent YTM). The 7.38 per cent- 10 year-2015 paper opened at Rs 97.15 (7.896 per cent YTM) and ended at Rs 97.34 (7.86 per cent YTM).

— Our Bureau

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