• On Thursday, the 10-year benchmark government bond (6.48% GS 2035) opened 1 bp higher at 6.60%. • Over the day, IGB 10y bond yields hardened to 6.62% on short selling ahead of tomorrow’s weekly bond auction and on caution before the release of the indicative calendar for state borrowing for Jan-Mar. • However, value-buying was witnessed amongst market participants, weighing on the 10Y point. • The 10Y point ended 1bp lower at 6.58% vs 6.59%. • The latest banking system liquidity turned into surplus of ~INR 173.35 Bn. RBI conducted overnight VRR for INR 1000 Bn and was partially subscribed at 5.26%.
