Money & Banking

Bonds remain weak

| | Updated on: Feb 24, 2011

Government bonds dropped further on sustained selling pressure by banks and corporates, while call rate closed slightly weak on the overnight call money market here on Thursday on surfeit of liquidity in the banking system.

The 8.13 per cent government security maturing in 2022 moved down further to Rs 99.96 from Rs 100.1750 yesterday, while its yield improved to 8.13 per cent from 8.11 per cent.

The 8.08 per cent government security maturing in 2022 also declined to Rs 99.4650 from Rs 99.65, while its yield firmed up to 8.15 per cent from 8.13 per cent previously.

The 7.99 per cent government security maturing in 2017 eased to Rs 99.60 from Rs 99.67, while its yield rose to 8.07 per cent from 8.05 per cent yesterday.

The 7.17 per cent government security maturing in 2015, the 7.80 per cent maturing in 2020 and the 8.26 per cent maturing 2027 too finished down at Rs 96.81, Rs 98.27 and Rs 97.83, respectively.

The call rate settled the day lower at 6.75 per cent from 6.80 per cent yesterday. It moved in a narrow range of 6.80 per cent and 6.65 per cent.

The Reserve Bank of India (RBI) under the Liquidity Adjustment Facility (LAF) purchased securities worth Rs 37,185 crore from 26 bids at one—day repo auction at a fixed rate of 6.50 per cent, while sold securities worth Rs 600 crore from one bid at one—day reverse repo auction at a fixed rate of 5.50 per cent.

Published on February 24, 2011

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