Bond yields traded higher on Tuesday, after SBI Research in its latest report has said that if there is no third wave of Covid-19 pandemic, the fiscal position of the Centre and the states will be much better than budgeted for FY22 and the states may garner Rs 60,000 crore more in tax collections at Rs 8.27 lakh crore this fiscal year than they have budgeted.
In the global market U.S. Treasury yields rose from three-month lows on Monday as investors waited on the Federal Reserve’s meeting statement on Wednesday for new indications on when the U.S. central bank is likely to begin paring back its unprecedented monetary stimulus. Furthermore, oil prices rose, with Brent gaining for a fourth consecutive session, as the prospect of extra supply coming to the market soon from Iran faded with talks dragging on over the United States rejoining a nuclear agreement with Tehran.
Back home, the yields on new 10 year Government Stock were trading 4 basis points higher at 6.04% from its previous close of 6.00% on Monday.
The benchmark five-year interest rates were trading 10 basis points higher at 5.64% from its previous close of 5.54% on Monday.