Bond yeilds rise by 6 bps

Bonds seem to taken the interim budget rather negatively with the new 10-year benchmark rising 6 basis points and the old benchmark rising 21 bps to trade at 5.91% and 6.37%.

Rupee is trading at 48.75 at 12 30 noon, falling 7 paisa from Friday's close.

"The estimated borrowings announced for the new year as more than what the market expected and market seems to be expressively its view," says Ashish Vaidya, head of interest rate trading at HDFC Bank. "But now all the focus is on the monetary pplicy. The mood in the coming days will be decided by the pace of the rate cuts," he said.

The rupee is trading largely lacklustre these days. On Monday noon, it fell 7 paisa to trade at 48.75. BSE Sensex fell 3.3% to trade at 9317. Dealers said the bearish mood in the stock market and dollar strength seems to be taking a toll on the local unit.

The dollar rose to a two-month high against a basket of major currencies on Monday as losses in the Euro and the pound accelerated on financial worries about European economies.

Liquidity is good with call money trading at a weighted average of 4.08%, near the reverse repo rate, as per CCIL.