The Hindu Business Line : Bond yields rise by 5 bps

Bond yields rose by around 5 basis points due to tight liquidity and on expectations that inflation could rise on Friday, said dealers. Traders are also expecting the RBI to announce State loan auctions, which could put further strain on liquidity. Total traded volumes on the order matching system were at Rs 4,260 crore (Rs 4,010 crore). On Thursday, the excess cash in the system fell to Rs 1,635 crore and the RBI also received bids for a repo auction worth Rs 180 crore. & #8220;The liquidity has become very tight from a surplus of Rs 30,000-40,000 crore,” said a bond dealer. Dealers are expecting call rates to tighten further tomorrow as the markets are closed for a long weekend. The 8.24 per cent-10 year-2018 paper opened at Rs 103 (7.78 per cent YTM) and closed at Rs 102.46 (7.88 per cent YTM), against the previous close of Rs 102.75 (7.83 per cent YTM). The 7.59 per cent -8-year 2016 paper opened Rs 98.1 (7.92 per cent YTM) and closed at Rs 97.82 (7.96 per cent YTM), against the previous close of Rs 97.99 (7.93 per cent YTM).

— Our Bureau

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