Bonds slide for second-day as investors dump debt

Government bonds (G-Secs) prices continued to witness downward pressure on the back of sustained selling from corporates and market participants.
Heavy unwinding by the Foreign Portfolio Investors (FPIs) in the face of currency volatility largely impacted the sentiment and also some caution ahead of Union Budget.
Bond markets are worried about higher government borrowings in the wake of robust expenditure commitments, a trader commented.
The interbank money market also turned weak after a brief rebound due to lackluster demand from borrowing banks on adequate liquidity in the banking system.
The 7.59 per cent government security maturing in 2026 dropped to Rs 98.41 from Rs 98.74 yesterday, while its yield spiked to 7.82 per cent from 7.77 per cent.

The 8.27 per cent government security maturing in 2020 slipped to 101.47 per cent compared to 101.76, while its yield rose to 7.85 per cent from 7.77 per cent.

The 7.88 per cent government security maturing in 2030 slumped to Rs 97.45 as against Rs 98.05 previously, while its yield jumped to 8.19 per cent from 8.11 per cent.
The 7.72 per cent government security maturing in 2025, the 7.59 per cent government security maturing in 2029 and the 7.68 per cent government security maturing in 2023 were also quoted substantially weak at Rs 101.47, Rs 95.4575 and Rs 97.95, respectively.

The overnight call money rates finished lower at 6.30 per cent from Monday's close of 6.80 per cent after trading between 6.95 per cent and 6.15 per cent earlier.
Meanwhile, the Reserve Bank of India (RBI), under the Liquidity Adjustment Facility (LAF),purchased securities worth Rs 104.87 billion in 18-bids at one-day repo auction at a fixed rate of 6.75 per cent this evening, while it sold securities worth Rs 31.40 billion from 22-bids at the one-day reverse repo auction at a fixed rate of 5.75 per cent late yesterday.