Bond Yield Opens Marginally Higher in Early Trading
Detailed Analysis
India's 10-Year Bond Yield Rises Marginally in Opening Trade
On April 21, India's 10-year bond yield experienced a marginal increase in the opening trade, reaching 6.895 percent at 9:10 am. This slight rise comes after a previous close of 6.89 percent.
The bond market is currently awaiting a significant sale of state government debt worth Rs 16,900 crore. Meanwhile, global funds have been actively participating in the market, with purchases of Rs 1,500 crore in sovereign bonds under the limits available to foreign investors, as well as additional investments of Rs 300 crore in corporate debt.
According to data from the Clearing Corporation of India Limited (CCIL), state-run banks sold Rs 756 crore of sovereign bonds on April 20. In contrast, foreign banks acquired Rs 1,080 crore worth of bonds during the same period.
The Reserve Bank of India (RBI) has taken steps to support the currency by relaxing some market restrictions it had imposed earlier this month. The central bank has announced the withdrawal of measures issued on April 1, which barred lenders from offering rupee-linked non-deliverable forwards, a widely used instrument for offshore trading. Additionally, the RBI has permitted some transactions under related party deals, although the $100 million cap on open positions imposed on March 27 remains in place.
In the global market, Brent crude prices hovered near $95 per barrel after dipping towards $94.50, while WTI crude traded below $87 in Asian trade. Market participants are waiting for further developments in US-Iran talks, which are expected to influence price movement.
| Market Segment | April 20 | April 21 | Change | | --- | --- | --- | --- | | State-run banks (sovereign bonds) | Sold Rs 756 crore | - | - | | Foreign banks (sovereign bonds) | Bought Rs 1,080 crore | - | - | | Global funds (sovereign bonds) | - | Bought Rs 1,500 crore | +100% | | Global funds (corporate debt) | - | Bought Rs 300 crore | +100% |
