Bonds rise on buying by banks and firms

Government securities (G-sec) rose on fresh buying support from banks and companies.

The 10-year benchmark federal bond yield flat at 8.17 per cent, with the outcome of Parliament vote expected to be a key factor in determining whether the government would have the appetite for future reforms, crucial for keeping fiscal deficit in check.

The 10-year bond yields held at the lowest level in more than a month on speculation the central bank will step up debt purchases to boost cash.

The 8.33 per cent G-sec maturing in 2026 surged to Rs 100.6 from Rs 100.54 yesterday, while its yield inched down to 8.25 per cent from 8.26 per cent.

The 8.20 per cent G-sec maturing in 2025 climbed to Rs 99.58 from Rs 99.44, while its yield moved down to 8.25 per cent from 8.27 per cent.

The 8.15 per cent G-sec maturing in 2022 gained to Rs 99.8625 from Rs 99.86, while its yield held steady at 8.17 per cent. The 8.97 per cent G-sec maturing in 2030, the 8.19 per cent maturing in 2020 and the 8.07 per cent maturing in 2017 also quoted higher at Rs 105.76, Rs 99.94 and Rs 99.77, respectively.

Call rates end lower
Call money rates finished lower at the money market here on Wednesday, due to lack of demand from borrowing banks. The rate ended lower at 8.05 per cent from its yesterday’s close of 8.10 per cent. It moved in a range of 8.10 per cent and 7.90 per cent.

The Reserve Bank of India (RBI) under the Liquidity Adjustment Facility (LAF) purchased securities worth Rs 79,625 crore in 32 bids at the one-day repo auction at a fixed rate of 8.00 per cent.