Colourless run on the cards

GOVERMENT SECURITIES

The government securities market is expected to remain lacklustre this week as investors would remain on the sidelines on account of year-end considerations.

The yield on the benchmark 10-year gilt is expected to hover around 6.60-6.70 per cent.

Meantime, the participants' focus would remain on global oil prices.

A decision to hike petro prices in India and the deliberations at the US Federal Reserve meeting this week will determine sentiment.

Another meeting, scheduled between the Union finance ministry and the Reserve

Bank of India on March 28 to finalise the details of the government's borrowing programme for the first half of 2005-06 will also be crucial.

There will be inflows of around Rs 92.23 crore during the week on account of redemption of government securities and coupon payments.

Recap: For a major part of last week the 10-year gilt yield was traded in the range of 6.60-6.70 per cent. Rising crude oil prices and talk of a domestic hike in fuel prices hurt the market sentiment. The higher-than-expected rise in inflation rate also dampened the sentiment.