Bond yields slump on RBI's OMO plan to infuse liquidity

RBI announced bond purchases of up to 100 billion rupees ($1.50 billion) to infuse liquidity into the banking system

Sovereign bond yields tumbled on Thursday after the Reserve Bank of India announced bond purchases of up to 100 billion rupees ($1.50 billion) to infuse liquidity into the banking system.

The RBI will conduct the bond purchases via open market operations (OMO) on December 7, it said in a release after market hours on Wednesday.

On Friday, the RBI will also conduct 28-day variable term repo for 250 billion rupees to inject funds into the banking system.

At 9:08 a.m, the benchmark 10-year bond yield was down 5 basis points at 7.69%.