Indian Government bonds remain under pressure amidst fresh supply of dated securities - ICICI Bank : Treasury Research

Indian Government bonds remained under pressure amidst fresh supply of dated securities worth INR 150 bn today. Sharp losses in US Treasuries over the last few sessions also weighed on the gilts. However, bonds received some support as the gilts auction was fully subscribed and the cut-off yields came in lower than expected. The auction yield on the 7.16% 2023 bond came in at 7.44% as compared to market consensus of 7.45%. Meanwhile, Moody's said that a weak Rupee reflects economic challenges faced by India and is likely to "affect the credit profiling" of the country. The old benchmark 8.15% 2022 bond yield closed at 7.62%, as against previous close of 7.64% while the new 7.16% 2023 ended the day at 7.44%, as against yesterday's close of 7.39%.

India's call rate closed at 7.10% as against previous close of 7.20%. The RBI injected INR 682.95 bn (gross) into the banking system today, as against INR 717.40 bn (gross) yesterday.

US Treasuries are trading little changed today following sharp losses in the last few sessions. Though value buying provided some support, continued speculation over scaling back of asset purchases going ahead this year capped the upside. The 10-year yield is currently trading at 2.41%, unchanged from previous close. (17:30 IST)

Source : Equity Bulls

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