• The 10-year benchmark government bond (6.48% GS 2035) opened 1bp lower at 6.69% ahead of state bond sale. • Over the day, 10Y yield eased to 6.66% level on short covering by market participants. • Meanwhile, the SDL auction result came better than market expectations. RBI offered 10Y Gujarat at 7.40%, 10Y Karnataka at 7.44%, 10Y Rajasthan at 7.52%, 11Y Maharashtra at 7.48%. • Indian rupee ended lower against the dollar at 90.95/$ vs 90.88/$ as market sentiment was risk averse due to rising tension between Iran and the US. • The 10Y point ended 2bps lower at 6.68% vs 6.70%. The latest banking system liquidity stands in surplus of ~INR 1931.69 Bn.
