The turnover in government bonds on the Negotiated Dealing System (NDS) was about Rs 430 crore. It is much below the normal trading levels seen in morning, a trader with public sector bank said.
The yield on 8.24 per cent 2018 bonds was 8.73 per cent.
The government on Saturday indicated that RBI will take further monetary steps and players have preferred to be on sidelines as any announcement (by) RBI will harden the yields further, another trader said.
The market estimates about 25 basis point increase CRR, an amount banks have to keep with RBI in cash out of deposits. At present CRR stands at 8.25 per cent. There is also possibility of a 0.25 per cent in repo rate, rate at which RBI lends money to banks. The key lending rate is 8.00 per cent. RBI has already raised repo rate once by 0.25 per cent.
