MUMBAI: Indian government bond yields rose on Friday after weaker-than-expected demand at the weekly debt auction, with the benchmark yield gaining this week on profit booking and the rise in US yields.
The benchmark 7.26% 2033 bond settled at 7.2704%, after ending the previous session at 7.2561%.
The yield rose five basis points (bps) this week, after easing 8 bps last week. Indian markets will remain closed on Monday for a local holiday. New Delhi raised 300 billion rupees through the sale of bonds earlier in the day.
The demand for the liquid 14-year paper turned out to be weaker than expected and the higher cutoff pushed the benchmark bond yield higher.
“Broadly, there have been no major triggers for the market. Bond yields have been largely tracking US yields and oil prices,” said Ajay Manglunia, managing director and head of the investment grade group at JM Financial.
“This will continue till the Reserve Bank of India’s (RBI) policy in December.”