Bond yields edge lower tailing lower crude prices and US yields

Bond yields edged lower as fall in global crude oil prices and U.S. yields, supported sentiments. However, further fall of yields is unlikely ahead of GDP data on Friday and RBI policy review on Tuesday. Q2 GDP data is estimated to have grown at 5 per cent or even lower in the second quarter of 2014-15, sharply lower than the 5.7 per cent witnessed in the first quarter. On the global front U.S. Treasuries yields fell on Tuesday, with long-dated ones hitting their lowest in over a month, after a strong auction of five-year notes and a single major bid for long-dated U.S. debt. Meanwhile, Oil prices dropped early on Wednesday as Asia's top economies showed signs of weakness, but hopes for output cuts by producer club OPEC curbed losses. Back home, the yields on new 10 year Government Stock 2023 was trading 1 basis point lower at 8.15% from its previous close of 8.16% on Tuesday. The benchmark five-year interest rate swaps were trading 1 basis point lower at 7.27% from its previous close of 7.28% on Tuesday. The Reserve Bank of India has announced the auction of 91 and 364 days Government of India Treasury Bills for notified amount of Rs 8,000 crore and Rs 6,000 crore respectively. The auction was conducted on November 27, 2014 using 'Multiple Price Auction' method. The allocation to the non-competitive bidders will be outside the notified amount at the discretion of the Bank. The Government of India have announced the sale (re-issue) of the Government Stock through auctions to be held on November 28, 2014, including (i) 8.27 per cent GS 2020 for a notified amount of Rs 3000 crore (ii) 8.40 per cent GS 2024 for a notified amount of Rs 6000 crore and (iii) 9.20 per cent GS 2030 for a notified amount of Rs 2000 crore and (iv) New 30 Years GS for a notified amount of Rs 3000 crore.