Government bonds turn bearish

Government securities (G-Sec) traded bearish on selling pressure from banks and companies. The prospect of an end to cheap Fed cash is leading to bond liquidation across emerging markets including India, stuck in a cycle in which a weaker rupee is making foreign investors sell debt and thus, causing further currency losses. The 8.33 per cent government security maturing in 2026 fell to Rs 105.83 from Rs 107.30 yesterday, while its yield shot up to 7.62 per cent from 7.45 per cent.

The 8.15 per cent government security maturing in 2022 dropped to Rs 103.29 from Rs 104.39, while its yield climbed to 7.64 per cent from 7.47 per cent. The 8.20 per cent government security maturing in 2025 declined to Rs 104.66 from Rs 105.98, while its yield advanced to 7.61 per cent from 7.45 per cent. The 8.07 per cent government security maturing in 2017, the 7.16 per cent government security maturing in 2023 and the 8.97 per cent government security maturing in 2030 also moved down to Rs 101.53, Rs 98.37 and Rs 111.65, respectively.

Call rate ends lower
Call money rates also ended lower due to lack of demand from borrowing banks. It finished lower at 7.20 per cent from 7.25 per cent yesterday. It moved in a range of 7.35 per cent and 7.20 per cent.

The Reserve Bank of India under the liquidity adjustment facility purchased securities worth Rs 71,740 crore in 28 bids at the one-day repo auction at a fixed rate of 7.25 per cent. It sold securities worth Rs 15 crore in one-bid at the one-day reverse repo auction at a fixed rate of 6.25 per cent.