Mumbai: The yield on the 10-year government bond closed 3 basis points higher on Tuesday after Bloomberg reported that the Centre will maintain its borrowing plan for the remainder of this fiscal. The new borrowing calendar will be now announced on 30 September to help banks avoid mark-to-market losses, the Bloomberg report added.
The yield on the 10-year Indian government bond closed at 6.781% compared with Monday’s close of 6.749%. Bond yields had surged Friday after the government announced a cut in corporate tax rates exacerbating fear of a revenue shortfall and higher government borrowing.
Meanwhile, the Indian rupee closed marginally lower against the US dollar. At close, the rupee was at 71.02 to a dollar, down from Monday's close of 70.93. The Indian unit had opened at 70.80 a dollar today.
Snapping the rally since the government announced a cut in corporate tax rates, Indian equity markets closed flat on Tuesday in volatile choppy trade. Banking and financial stocks were the top losers, while information technology companies and Reliance Industries were the top gainers
In the year so far, the rupee has weakened 1.5%, while foreign investors have bought nearly $6.44 billion in Indian equities and $4.42 billion in debt.
Other Asian currencies closed largely flat amid hopes of progress in the US-China trade talks, even as worries remain over global growth following weak economic data from Europe.
Indonesian rupiah closed 0.07% lower, and Philippines peso, China Offshore, Thai Baht and South Korean won fell 0.04% each. However, Taiwan dollar was up 0.06% and Singapore dollar gained 0.04%.