Gilt yields high on tight liquidity conditions
Gilt yields high on tight liquidity conditions Gilt yields remained high on September 24, on tight liquidity conditions in the banking system on account of payment of tax by the corporates. The sentiments of the investors got affected in the bond market, as fresh government bonds worth Rs 165 billion and treasury bills of 91-days and 364 - days will be issued in this week. With issuance of market stabilization scheme, liquidity conitions will be tightened In addition to that, prices of the gilt were low on speculation that rising crude oil prices may affect the headline inflation causing it to rise. Inter- bank call rate which stood high above 7%, is hovering around the rate of central banks rate of 7.75% reflecting tight liquidity. The benchmark 10-year federal bond yield ended at 7.86%, up four basis points from Friday`s close 7.82%.
