Indian bonds erased losses and traded marginally higher on Tuesday as traders said the central bank likely intervened by buying bonds in the secondary market, while sentiment was also helped after the government announced a planned debt buyback.
Data on how much the Reserve Bank of India bought in secondary markets was not immediately available. Such data is available daily after the close of markets as well as weekly.
The Reserve Bank of India also announced the government will buy back 200 billion rupees ($3.10 billion) of bonds on Dec. 18.
The benchmark 10-year bond yield was down 2 basis points at 7.17 percent from its close on Tuesday, having earlier risen to as high as 7.26 percent after stronger-than-expected inflation data spooked investors.