The 10 year government bond yield increases 3% to 6.66 from 6.46 in the previous week. US 10 year benchmark increased 4% to 1.843 as compared to 1.774 in the previous week. The g-sec yields ended uper this week.
In a surprise move, Monetary Policy Committee (MPC) decided to keep rates unchanged despite clamors for further rate cuts. MPC unanimously voted in favor of keeping the policy repo rate unchanged at 5.15%. The MPC also decided to continue with the accommodative stance as long as it is necessary to revive growth, while ensuring that inflation remains within the target. FY20 GDP growth forecast cut sharply to 5% from 6.1% projected earlier. 2H FY20 GDP growth seen at 4.9-5.5% versus 6.6-7.2% projected earlier.
OPEC and its allies completed a new production pact to deepen their oil-output cuts, delegates said Friday. The 24-nation consensus coincides with the initial public offering of Saudi Arabia’s state-controlled national oil company, Aramco, and illustrates a renewed assertiveness from the alliance’s de facto leader and Saudi’s new oil minister, Prince Abdulaziz bin Salman. Prince Abdelaziz says that Saudi Arabia’s will continue voluntary cuts to off set the limitations of other opec and non opec members. Saudi oil minister says we will continue the voluntary cut of 400k which brings the opec+ total to 2.1 million.
Overseas, developments on the U.S.-China trade front will be closely watched. As per reports, China’s finance ministry said the country will waive import tariffs for certain soybean and pork shipments from the U.S., without providing further detail. The Federal Reserve’s two day meeting begins on Tuesday, 10 December 2019 and the interest rate decision will be announced on Wednesday, 11 December 2019. In Europe, European Central Bank (ECB) will announce its interest rate decision on Thursday, 12 December 2019.
FII/FPI IN DEBT MARKET
|S&P BSE SENSEX||40445.15||40793.81||-0.85|
|Policy Repo Rate||5.15%|
|Reverse Repo Rate||4.90%|
|Foreign Exchange Reserves (08/Nov)||$447.00B||$439.71B|
|WPI Inflation YoY (Sep)||0.10%||0.33%|
|Inflation Rate YoY (Sep)||4.62%||3.99%|
|10 yr bond yield||6.661%||6.46%|
|3yr bond yield||6.251%||6.00%|
|1yr bond yield||5.568||5.32%|
|US 10 yr benchmark yield||1.843||1.774%|
|07.37 GS 2023||16/04/2023||6.2600%||6.0100%|
|07.32 GS 2024||28/01/2024||6.4300%||6.1900%|
|07.17 GS 2028||08/01/2028||6.9200%||6.7400%|
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