Govt bonds trading steady

Government bonds are trading steady with little change in prices after the central bank left key rates unchanged. Dealers said the lack of any major announcements in the statement was largely expected and bonds too are trading unchanged.

"The no-change stance was as expected given the easy liquidity with over Rs.1 trillion flowing into Reverse Repo counter at 3.25% and stable term money market rates," said J. Moses Harding, Head ��� Global Markets Group, IndusInd Bank. . "RBI has also provided comfort to address price-stability to minimise impact of growth and inflationary pressures leading to liquidity squeeze and rate reversal."

The benchmark ten-year yield fell two basis points from its previous close to trade at 6.95% at 12.45pm, with the market staring at another Rs 12,000 cr bonds auction this week.

The economy may expand 6.5% in the year ending March 31, versus an earlier forecast of 5.7% growth, the central bank said in the report yesterday, citing a survey of professional forecasters.

The rupee also traded unchanged at 48.16 against the dollar, with the greenback trading weak against major currencies. This is ahead of US GDP figures later in the week as the market awaits the report card on the world's biggest economy.

The dollar index - gauge of the dollar���s movement against six major currencies - was down 0.3% by 12.45 pm with global stocks rallying. However the Indian key benchmark index BSE Sensex was trading weak.