India’s 10-year bond yields fell to their lowest level in more than three weeks on speculation that the Reserve Bank of India would temper the pace of interest-rate increases, as economic growth slows.
The yield on the 7.80 per cent note due April 2021 fell four basis points to 8.24 per cent, the lowest level since
May 12, at close in Mumbai, according to the central bank’s trading system.
The cost of one-year interest-rate swaps, or derivative contracts used to guard against fluctuations in borrowing costs, fell eight basis points to 7.89 per cent.
RUPEE FALLS
The rupee fell, snapping a nine- day advance, on concern global investors will slow purchases of emerging-market assets after the Federal Reserve signaled the world’s largest economy remains weak.
The Indian currency weakened 0.04 per cent to 44.70 per dollar at close in Mumbai, according to data compiled by Bloomberg. The Bombay Stock Exchange Sensitive Index fell 0.6 percent as shares across Asia declined. Offshore forwards indicate the rupee will trade at 45.34 to the dollar in three months, compared with expectations of 45.30 yesterday.
CALL RATE STEADY
The call rate ended stable on the overnight call money market on Wednesday on alternate bouts of demand and supply. The overnight call rate ended ended the day at its previous closing level of 7.40 per cent. It moved in a range of 7.45 per cent and 7.25 per cent.
