Yields on gilts fell to life lows on easy money, but faced resistance with many banks wary about the drop.
Volumes were light, and a few banks with extra cash bought, causing prices to jump.
The 10-year gilt was dealt at 6.4008 per cent, slightly below 6.4042 per cent hit on Saturday.
Call money rates closed below the repo rate of 5.5 per cent. Most banks are well covered before the reporting Friday.
Corporate bond yields were little changed on Tuesday, supported by ample liquidity.
The five-year corporate bond benchmark was quoted at 6.4963 per cent, little changed from Monday's 6.495 per cent.
Forex
Market Sentiment: Bullish on rupee
The rupee ended marginally weaker on late short-covering in ranged trade, while forward dollar premiums fell sharply on heavy exporter sales, traders said. The rupee ended at 48.21/22 per dollar, against Monday
