The Hindu Business Line : Bond prices fall

Bond prices fell by 33 paise on fears of further tightening of liquidity. A bond dealer said tight liquidity conditions prevailed in the market as banks borrowed close to Rs 39,000 crore from the Reserve Bank under the liquidity adjustment facility. According to bond dealers, inflation is expected to increase further this week. Another bond dealer said that the cash subsidies paid to the fertiliser companies by the Government and the new CRR coming into effect from August 30 would further squeeze liquidity out of the system.

Total traded volumes on the order matching system were at Rs 3,060 crore (Rs 3,005 crore). The 8.24 per cent-10 year-2018 paper opened at Rs 94.25 (9.14 per cent YTM) and touched an intra-day high of Rs 94.37 (9.12 per cent YTM). It finally closed at Rs 94.3 (9.13 per cent YTM) against the previous close of Rs 94.63 (9.08 per cent YTM). The second highly traded security, the 7.95 per cent-24 year-2032 paper opened at Rs 82.41 (9.87 per cent YTM) and closed at Rs 82.39 (9.87 per cent YTM).

— Our Bureau

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