Gilts extend slide on continued selling; call rates drop

The government bond (G-Sec) prices remained under intense selling pressure for the second day on the back of sustained unwinding by banks and corporates.
Interbank call money rate also dropped sharply due to to lackluster demand from borrowing banks supported by comfortable liquidity conditions in the banking system.
The 10-year benchmark bond 8.40 per cent maturing in 2024 declined to Rs 103.09 from Rs 103.1875 yesterday, while its yield gained to 7.92 per cent against 7.90 per cent.
The 7.72 per cent government security maturing in 2025 fell to Rs 99.80 from Rs 99.88, while its yield inched-up to 7.75 per cent from 7.74 per cent.

The 8.27 per cent government security maturing in 2020 moved down to Rs 101.32 from Rs 101.38, while its yield edged up to 7.94 per cent from 7.93 per cent.
The 7.68 per cent government security maturing in 2023, the 8.15 per cent government security maturing in 2026 and the 7.28 per cent government security maturing in 2019 were also quoted substantially lower at Rs 98.4775, Rs 101.04 and Rs 98.20, respectively.

However, the 8.60 per cent government security maturing in 2028 recovered to Rs 104.78 compared to Rs 104.68 previously, while yield softened to 8.00 per cent from 8.01 per cent.

The overnight call money rates dropped further to 6.60 per cent from Monday's close of 7.25 per cent. It traded in a range of 7.35 per cent and 6.50 per cent earlier.
Meanwhile, the Reserve Bank of India under the Liquidity Adjustment Facility (LAF) purchased securities worth Rs 51 billion in 12-bids at the three-day repo auction at a fixed rate of 7.25 per cent this morning, while it sold securities worth Rs 27.17 billion from 21-bids at the one-day reverse repo auction at a fixed rate of 6.25 per cent yesterday evening.