AGL 37.62 Decreased By ▼ -0.53 (-1.39%)
AIRLINK 122.00 Increased By ▲ 0.49 (0.4%)
BOP 5.72 Decreased By ▼ -0.13 (-2.22%)
CNERGY 3.71 Decreased By ▼ -0.04 (-1.07%)
DCL 8.32 Decreased By ▼ -0.08 (-0.95%)
DFML 40.72 Decreased By ▼ -0.17 (-0.42%)
DGKC 84.60 No Change ▼ 0.00 (0%)
FCCL 33.25 Increased By ▲ 0.55 (1.68%)
FFBL 65.50 No Change ▼ 0.00 (0%)
FFL 9.92 Decreased By ▼ -0.13 (-1.29%)
HUBC 103.79 Decreased By ▼ -0.01 (-0.01%)
HUMNL 13.23 Decreased By ▼ -0.02 (-0.15%)
KEL 4.41 Decreased By ▼ -0.02 (-0.45%)
KOSM 7.05 Decreased By ▼ -0.04 (-0.56%)
MLCF 37.70 Increased By ▲ 0.20 (0.53%)
NBP 59.86 Decreased By ▼ -0.39 (-0.65%)
OGDC 175.19 Increased By ▲ 2.94 (1.71%)
PAEL 24.85 Increased By ▲ 0.05 (0.2%)
PIBTL 5.73 Increased By ▲ 0.03 (0.53%)
PPL 145.97 Increased By ▲ 4.28 (3.02%)
PRL 22.77 Increased By ▲ 0.05 (0.22%)
PTC 14.97 Increased By ▲ 0.23 (1.56%)
SEARL 65.14 Increased By ▲ 0.58 (0.9%)
TELE 7.04 Decreased By ▼ -0.10 (-1.4%)
TOMCL 35.65 Increased By ▲ 0.15 (0.42%)
TPLP 7.32 Increased By ▲ 0.03 (0.41%)
TREET 13.95 Decreased By ▼ -0.25 (-1.76%)
TRG 50.90 Decreased By ▼ -0.85 (-1.64%)
UNITY 26.40 Decreased By ▼ -0.20 (-0.75%)
WTL 1.22 No Change ▼ 0.00 (0%)
BR100 9,543 Increased By 59.5 (0.63%)
BR30 28,579 Increased By 208.3 (0.73%)
KSE100 89,476 Increased By 509.4 (0.57%)
KSE30 27,943 Increased By 115.8 (0.42%)

Indian federal bond yields rose on Friday after the central bank warned it had limited room for further monetary easing while delivering a 25 basis point cut in the key lending rate in line with expectations. The Reserve Bank of India also reduced the amount of bonds that banks can hold till maturity while leaving the cash reserve ratio unchanged, disappointing bankers.
The benchmark 10-year yield climbed as much as 4 basis points to 7.81 percent immediately after the decision. However, yields retreated later on hopes the central bank will conduct open market operations to infuse liquidity. RBI Governor Duvvuri Subbarao said OMOs were "as good as" a cash reserve ratio cut, "if not better", to manage liquidity. The 10-year yield closed at 7.74 percent, up 2 basis points. For the week, it ended flat after five consecutive weeks of falls.
After trading hours, the RBI said it would buy back up to 100 billion rupees of bonds on Tuesday. Yields rose early trading on Friday after a central bank report, released late Thursday, said that the scope for further rate cuts was limited. However, the RBI warned that the risk of inflationary pressure persists despite a recent sharp decline in wholesale price index (WPI) inflation, and said a high current account deficit poses the biggest risk "by far" to the Indian economy. The RBI said it expects the economy to expand 5.7 percent in the current fiscal year, lower than government forecasts.
Most economists now expect a 25 basis points cut in the rest of the calendar year with a fewer number calling a 50 basis points cut. Swap rates were largely unaffected by the RBI move. The five-year swap rate rose 1 bp to 6.89 percent, while the near-end swap ended flat at 7.20 percent.

Copyright Reuters, 2013

Comments

Comments are closed.