India's call rate closed at 7.28% - ICICI Bank : Treasury Research

Indian Government bonds edged lower tracking losses in US Treasuries amidst broad based caution ahead of the FOMC policy outcome due tomorrow. Sharp depreciation in the Rupee also weighed on the sentiment and further added to the bearishness in gilts. Fresh supply of debt worth INR 150 bn on Friday also added to the downside. However, losses were somewhat limited as the RBI in the policy statement released yesterday provided a less cautious rate guidance. The old benchmark 8.15% 2022 bond yield closed at 7.48%, higher than yesterday's close of 7.45% while the new 7.16% 2023 ended the day at 7.28%, as against yesterday's close of 7.25%.

India's call rate closed at 7.28% as against previous close of 7.25%. The RBI injected INR 668.45 bn (gross) into the banking system today, as against INR 713.40 bn (gross) yesterday.

US Treasuries extended their losing streak as sentiment remains cautious ahead of the 2-day FOMC policy meeting starting later today. Markets would also closely watch US CPI data and housing starts print for further cues on economic recovery. Meanwhile, the benchmark Treasury yield had risen by 5 bps yesterday as positive economic data over the last few sessions led to rising speculation in some quarters that the Fed is likely to signal scaling back of asset purchases. The 10-year yield is currently trading at 2.19% a tad higher than prior close of 2.18%. (17:30 IST)

Source : Equity Bulls

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