India Bond Yields Steady As Debt Sale Result Awaited

Friday,   03-Dec-2021   01:18 PM (IST)

Indian federal government bond yields were little changed in the afternoon session, as traders awaited the outcome of today’s weekly debt auction. The benchmark 6.10% bond maturing in 2031 changed hands at 98.11 rupees, yielding 6.36% as of 1:00 p.m. in Mumbai, versus 98.20 rupees and 6.35% yield at close yesterday. The rupee was at 75.05 to the dollar, as against 74.9950 yesterday. The Reserve Bank of India is auctioning 240 billion rupees of government bonds today, including the benchmark 2031 note. India's central bank will announce its policy rate decision on Dec. 8. Chances that the RBI may delay steps to normalize its pandemic-era stimulus have increased after the country detected two cases of the Omicron variant of Covid-19 in the southern state of Karnataka. The spread of the Omicron could outpace the Beta and Delta variants of coronavirus, joint secretary at the federal health ministry, Lav Agarwal, said yesterday. Late last month, South Africa first reported the new variant of Covid-19, which has been described as a "variant of concern" by the World Health Organization, and this could pose a threat to the fragile economic recovery. Meanwhile, Brent crude futures rose 1.79% to $70.92 per barrel after the Organization of the Petroleum Exporting Countries, Russia and its allies, together called OPEC+, surprised the market on Thursday when it stuck to plans to add 400,000 barrels per day of supply in January. India imports about 85% of its crude requirements, and a rise in global oil prices risks stoking inflation in the country.