• On Tuesday, the 10-year benchmark government bond (6.48% GS 2035) opened 3bps lower at 6.92% tracking the overnight fall in Brent crude oil prices on hopes of a permanent ceasefire in West Asia. • Over the day, 10Y yield stayed weaker on likely FPI inflows in bond market as an aftermath of measures announced by the RBI and the government to improve foreign inflows. • Meanwhile, the SDL auction cut-off yield was better than market expectations. RBI offered 10Y Tamil Nadu at 7.6309%, 11Y Gujarat at 7.63%. • Indian rupee ended higher against the dollar on expectation of substantial dollar inflows on the back of the RBI's foreign capital measures and a fall in Brent crude oil price. INR ended at 95.35/$ vs 95.71/$. • The 10Y point ended 4bp lower at 6.91% vs 6.95%. The latest banking system liquidity stands in surplus of ~INR 1336.91 Bn.
