10-year bond yield hits lowest level since demonetisation, closes at 6.33%

Spread between G-secs, equivalent maturity pvt bonds has widened

Yields on the 10-year government bonds have fallen to their lowest since demonetisation, a movement sharp enough to leave their corporate bond counterparts far behind.

The 10-year bond yield closed at 6.33 per cent on Tuesday, the lowest since December 6, 2016. The bond yields had plummeted in 2016 due to huge liquidity in the banking system after the government demonetised high-value currency.

The five-year government bonds also closed near the same level, at 6.35 per cent. The spread between the government bond and equivalent maturity private bonds, however, has widened as corporate bond yields have not fallen as sharply