Bonds remain weak on continued selling; call rates firm up

The government bond (G-Sec) prices fell for the third straight day on the back of sustained unwinding by market participants as well as foreign funds ahead of the weekend.
However, the interbank call money rate firmed up further owing to good demand from borrowing banks in the face of tight liquidity conditions in the banking system.
Bond investors are paring long positions in the past few day in the midst of falling rupee also cautious due to potential inflationary pressures, a dealer commented.
The 10-year benchmark bond 8.40 per cent maturing in 2024 dropped to Rs 101.8450 from Rs 101.95 yesterday, while its yield rose to 8.11 per cent compared with 8.09 per cent.

The 8.27 per cent government security maturing in 2020 drifted to Rs 100.5750 from Rs 100.71, while its yield shot-up to 8.13 per cent from 8.09 per cent.
The 8.60 per cent government security maturing in 2028 slumped to Rs 103.26 against Rs 103.39, while its yield climbed to to 8.19 per cent from 8.17 per cent.

The 7.78 per cent government security maturing in 2030 moved down to Rs 97.87 from Rs 98.1250, while its yield edged higher to 8.13 per cent from 8.10 per cent.
The 7.72 per cent government security maturing in 2025, the 8.15 per cent government security maturing in 2026 and the 7.68 per cent government security maturing in 2023 were also quoted lower at Rs 98.86, Rs 99.74 and Rs 97.3475, respectively.

The overnight call money rates ended firmly higher at 7.10 per cent compared to Wednesday's closing level of 6.80 per cent after trading in a range of 7.25 per cent and 6.50 per cent earlier. While, three-day call money rates slipped to 7.15 per cent from 8.00 per cent last Friday. It fluctuated between 7.40 per cent and 5.75 per cent during the trade.
Meanwhile, the Reserve Bank of India under the Liquidity Adjustment Facility (LAF) purchased securities worth Rs 109.61 billion in 26-bids at the three-day repo auction at a fixed rate of 7.25 per cent this morning, while it sold securities worth Rs 37.26 billion from 17-bids at the one-day reverse repo auction at a fixed rate of 6.25 per cent yesterday evening.