Bond yields rise yet again, rupee slips to 49.78
Yields on government securities rose on Thursday even as RBI sold a new 5-year bond at a yield much below what traders expected. The yield on the benchmark 10-year paper rose 7 basis points to 6.39%.
By ET Bureau |
MUMBAI: Yields on government securities rose on Thursday even as RBI sold a new 5-year bond at a yield much below what traders expected. The yield on the benchmark 10-year paper rose 7 basis points to 6.39%. Dealers attributed the weakness to nervousness about upcoming poll results.
Similar concerns played spoilsport for the rupee too, although it bounced off twoweeks lows to end at Rs 49.78 against the dollar. Traders in both markets say all eyes are now on the national election results that will be out on Saturday.
Bonds were also under pressure after exit polls signalled neither of the two main political alliances will have enough votes to form a government without the support of smaller parties. ���The mood as such is largely positive, but traders are nervous about what results the elections may throw up on Saturday,��� said a bond dealer at Axis Bank.
RBI said it raised Rs 12,000 crore as a part of the government���s record borrowing programme by selling five and 13-year bonds at an auction. The central bank sold Rs 8,000 crore of new benchmark five-year notes at a cut-off yield of 6.07% (market expected 6.17%) and Rs 4,000 crore of 8.2% notes due in 2022 at a yield of 7.35% (market expected 7.25%).
The rupee���s close was off an early low of 50.02, its lowest since April 29, but still weaker than Wednesday���s close of 49.69. The local unit was also under pressure due to the dollar���s strength. Meanwhile, RBI governor D Subbarao said on Thursday that the central bank will seek to unwind the monetary measures taken since September, after the crisis ends.
Similar concerns played spoilsport for the rupee too, although it bounced off twoweeks lows to end at Rs 49.78 against the dollar. Traders in both markets say all eyes are now on the national election results that will be out on Saturday.
Bonds were also under pressure after exit polls signalled neither of the two main political alliances will have enough votes to form a government without the support of smaller parties. ���The mood as such is largely positive, but traders are nervous about what results the elections may throw up on Saturday,��� said a bond dealer at Axis Bank.
RBI said it raised Rs 12,000 crore as a part of the government���s record borrowing programme by selling five and 13-year bonds at an auction. The central bank sold Rs 8,000 crore of new benchmark five-year notes at a cut-off yield of 6.07% (market expected 6.17%) and Rs 4,000 crore of 8.2% notes due in 2022 at a yield of 7.35% (market expected 7.25%).
The rupee���s close was off an early low of 50.02, its lowest since April 29, but still weaker than Wednesday���s close of 49.69. The local unit was also under pressure due to the dollar���s strength. Meanwhile, RBI governor D Subbarao said on Thursday that the central bank will seek to unwind the monetary measures taken since September, after the crisis ends.
Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
Bookmark or read stories offline -
Download ET Markets APP
Download ET Markets APP
ADVERTISEMENT
