Gilt yields marginally low on speculation of Fed cut
Gilt yields marginally low on speculation of Fed cut Gilt yields fell marginally on Sep. 14, 2007 on speculation of Federal Reserve cut on interest rates. The sentiments of the traders in the debt market got affected on speculation that the Federal Reserve will cut its interest rates to retain the economy going into recession. The demand of gilt was also high on anticipation that there will be ample liquidity conditions, although there would be cash outflow from the banking system as corporate pay for their taxes. Besides that, inflation is declining since two weeks. The headline inflation dipped to 3.52% for the week ended September 1, from 3.79% in the previous week. Market estimates for inflation stood at 3.28%. The benchmark yield on the 10-year bond ended at 7.86%, marginally lower than Thursday`s close of 7.87%.
