• On Tuesday, the 10-year benchmark government bond (6.48% GS 2035) opened flat at 7.02% on caution ahead of the RBI Monetary Policy Committee decision. • Over the day, 10Y yield dropped to 6.98% tracking the fall in crude oil prices and short-covering by traders. Brent crude for delivery in August was at $93.82/barrel, down from an intraday high of $95.50/barrel. • Meanwhile, the SDL auction cut-off yield was largely in line with market expectations. RBI offered 10Y Gujarat at 7.70%, 10Y Tamil Nadu at 7.74%. • Indian rupee ended lower at 95.26/$ vs 94.90/$ as banks bought dollars for importers and foreign fund outflows amid rising uncertainty around a peace deal between the US and Iran. • The 10Y point ended flat at 7.01%. The latest banking system liquidity stands in surplus of ~INR 854.11 Bn.
