Gilts retreat on fresh selling; call rates remain firm

The government bond (G-Sec) prices declined following renewed selling by banks and corporates amid profit taking by market participants.
Extremely weak rupee too weighed on the trade.
Meanwhile, call rates continued surge at the inter-bank call money market due to steady demand from borrowing banks on the back of tight liquidity conditions in the banking system.
The 10-year benchmark bond 8.40 per cent maturing in 2024 softened to Rs 102.5425 from weekend level of Rs 102.65, while its yield inched up to 7.99 per cent against 7.98 per cent.
The 7.72 per cent government security maturing in 2025 slipped to Rs 99.44 from Rs 99.54, while its yield moved to 7.79 per cent from 7.80 per cent.

The 8.15 per cent government security maturing in 2026 edged down to Rs 100.5550 compared to Rs 100.6950, while its yield gained to 8.07 per cent from 8.06 per cent.

The 8.27 per cent government security maturing in 2020, the 8.60 per cent government security maturing in 2028 and the 7.68 per cent government security maturing in 2023 were also quoted lower at Rs 101.0150, Rs 104.0700 and Rs 98.12, respectively.
The overnight call money rates shot-up to 8.15 against against Friday's closing level of 7.40 per cent after trading in a wide range of 8.20 per cent and 7.10 per cent.

Meanwhile, the Reserve Bank of India (RBI) under the Liquidity Adjustment Facility (LAF) purchased securities worth Rs 66.38 billion in 19-bids at the 1-day repo auction at a fixed rate of 7.25 per cent this morning.