Government bond prices tumbled on Friday by over a rupee-and-a-half as absence of any new liquidity boosting measures from Reserve Bank of India (RBI) in its mid-term review of annual policy statement on Friday hurt sentiment, dealers said.
The 10-year benchmark 8.24 per cent, 2018 paper ended the day at Rs 102.93 down from Thursday’s closing of Rs 104.53. Fears that the government would announce big gilt auctions for next week also kept sentiment weak through the day.
“The government was scheduled to borrow a big amount in October but has not been able to do so. And the policy is also done, so there is a worry that they will announce the auctions on Friday,” said a dealer at a UK bank.
