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Informist, Friday, Nov. 8, 2024

MUMBAI – Money markets are shut on Saturday. On Monday, government bond prices and overnight indexed swap rates may take cues from the movement in US Treasury yields, crude oil prices and any other geopolitical developments over the weekend, dealers said.

On Monday, the one-day call money rate may open around the Reserve Bank of India's repo rate of 6.50% because of the demand for funds from banks in early trade for reserve requirements.

GOVERNMENT BONDS

On Monday, prices of government bonds may take cues from the movement in US Treasury yields, crude oil prices and any geopolitical developments, dealers said. 

Traders may avoid large bets before the release of India's CPI inflation data for October on Tuesday. Unlike in the past, the data will released during market hours at 1600 IST on Tuesday. Though the print is expected to be higher, traders will watch for the divergence from the estimated 5.9% to form a view on the December rate cut scenario by the Monetary Policy Committee, dealers said. 

The yield on the 10-year benchmark, 7.10%, 2034 bond is seen at 6.78-6.85%. The yield on the 6.79%, 2034 bond is seen at 6.74-6.81%. On Friday, the 7.10%, 2034 bond closed at INR 101.97, or 6.81% yield, and the 6.79%, 2034 bond ended at INR 100.09, or 6.78% yield.

OIS RATES

On Monday, swap rates may take cues from the movement in US Treasury yields, crude oil prices and any geopolitical development over the weekend, dealers said.

The swap rate in the one-year segment is seen at 6.43-6.60% and in the five-year segment at 6.20-6.40. On Friday, the one-year swap rate closed at 6.51% and the five-year swap closed at 6.23%. 

CALL

On Monday, the one-day call money rate may open around the RBI's repo rate of 6.50% because of the demand for funds from banks in early trade for reserve requirements.

During the day, the call rate is seen in a range of 6.00-6.60%, dealers said. On Friday, the three-day call rate ended at 6.55%.

RBI AUCTION

--RBI to hold INR 1.75 trillion, 3-day variable rate reverse repo auction 1000-1030 IST Monday 

LIQUIDITY

--Total net outflows of INR 11.74 billion. Calculation of flows does not take into account redemption of the standing deposit facility and scheduled variable rate repo and reverse repo.

* Inflows

--INR 4.09 billion as coupon on state bonds on Saturday

--INR 29.67 billion as coupon on 5.15%, 2025 bond on Saturday

--INR 38.43 billion as coupon on 7.61%, 2030 bond on Saturday

--INR 22.50 billion as coupon on state bonds on Sunday

--INR 5.00 billion as redemption on state bonds on Sunday

--INR 43.34 billion as coupon on 8.24%, 2033 bond on Sunday

--INR 12.92 billion as coupon on state bonds on Monday

--INR 20.00 billion as redemption on state bonds on Monday

--INR 32.31 billion as coupon on 5.79%, 2030 bond on Monday

--INR 1.03 trillion as redemption on 4-day variable rate reverse repo

--INR 500.13 billion as redemption on 3-day variable rate reverse repo

* Outflows

--INR 220.00 billion as payment for gilts on Monday

End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Reported by Srijita Bose

Edited by Saji George Titus

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