• On Tuesday, the 10-year benchmark government bond (6.48% GS 2035) opened steady at 6.63% as market participants remained cautious ahead of weekly SDL auction. • The SDL auction worth INR 301 Bn saw mixed cut offs. Papers with tenors of 15 years and below saw slightly higher-than-expected yields, while papers with tenors above 15 years recorded better than expected cut-offs. RBI offered 10Y Tamil Nadu at 7.48%, 12Y Jammu & Kashmir at 7.67% and 20Y Chhattisgarh at 7.59%. • However, the 10Y point eased 2bps to end at 6.61% on short-covering. • Meanwhile, Indian rupee ended higher at 90.17/$ amid likely RBI intervention. • The latest banking system liquidity stands in surplus of ~INR 648.12 Bn.
