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Mumbai, Jan. 29

The bond market was weak post the monetary policy, as the Reserve Bank of India left key interest rates unchanged. The direction of the policy is weak, said a bond dealer with a private sector bank. “The policy focuses more on management of inflation, particularly consumer price index inflation, and management of money supply. If the M3 growth is going to be monitored in such a close manner then the implication is that RBI will continue to suck out liquidity through market stabilization schemes. There is nothing for the bond market to look forward to,” said the dealer.

Total traded volumes on the order-matching system were at Rs 8,850 crore (Rs 5,120 crore). There was gradual selling in the bond market. The 7.99 per cent – 9 year-2017 paper opened at Rs 103.69 (7.44 per cent YTM) and closed at Rs 102.96 (7.54 per cent YTM); against the previous close of Rs 103.58 (7.45 per cent YTM). “The benchmark paper saw some support at levels of 7.5 per cent, but then crossed those levels,” the dealer said.

The 8.33 per cent 28 year-2036 paper opened at Rs 106.6 (7.75 per cent YTM) and closed at Rs 105.4 (7.85 per cent YTM) against the previous close of Rs 106.6 (7.75 per cent YTM).

– Our Bureau

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