FY21: Momentous year for bonds, rupee and forex reserves amid the pandemic

Supply outpaced demand for fixed-income paper with Centre's Rs 12 trn borrowing plan and Rs 10 trn by states. But RBI support ensured it didn't pinch hard till the end of the year

In a relief of sorts for the bond market, the yields on the 10-year bond are closing lower than how the started the year, but it could have been a lot worse.

The 10-year bond yields closed at 6.147 per cent on Tuesday, on the eve of the closure of the financial year 2020-21. The yields started the financial year at 6.305 per cent as the nation grappled with a lockdown.

The yields could have inched up higher following the US yields, and rising oil prices, but deft handling by the RBI ensured yields remained soft.

If the yields close