5 Aug 2024

Government Bond Yields Fall as US Recession Fears Spike

author dp
Team INRBonds
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Weekly Market Highlights:

  1. 10 year 2034 Gsec yields closed at 6.93%, down by 1 bps on weekly basis.
  2. Weekly Gsec auction cut-off for the 2027 and 2054 stood at 6.8082% and 7.09% respectively, while the cut-off for the SGrB for 2034 was 6.9%.
  3. 3M and 6M T-bill auction data yields were at 6.67% and 6.79% respectively, down by 4 bps on a weekly basis.
  4. India’s fiscal deficit narrowed to 8.1% for the full year v/s 25.3% in the previous year.
  5. Domestic market liquidity deficit stood at Rs.196.5 billion.
  6. The INR Bonds high yield Index stood at 9.744% down 3 bps biweekly basis.
  7. The Bank of England cut its rates for the first time since 2020 to 5% from a 16 year high of 5.25%.
  8. The JPY strengthened with unexpected hawkish policy announcements by the BoJ.
  9. US PMI came in at an 8 month low of 46.8, job growth reduced 114,000 in July from 179,000 in June and unemployment rate rose to 4.3%.
  10. The US 10-year fell by 40 bps to 3.79% as recession fear spikes weak economic data.

Market Data

Particulars

2/8/2024

26/7/2024

Change

10 Yr Benchmark Gsec (%)

6.93%

6.94%

-1 bps

Banking Liquidity (in Rs Billion)

-196.5

-85.92

-128.70%

5 Yr OIS (%)

6.09%

6.26%

-18 bps

1 Yr OIS (%)

6.54%

6.70%

-16 bps

INRBonds Retail High Yield Index

9.74%

9.77%

-3 bps

Nifty

24,718

24,834

-0.47%

10 Yr SDL

7.28%

7.36%

-8 bps

91 Day T-Bill (%)

6.67%

6.71%

-4 bps

182 Day T-Bill (%)

6.79%

6.82%

-3.5 bps

10 Yr US Treasury Yield (%)

3.79%

4.19%

-40.2 bps

US Junk Bond Yield (%)

7.32%

7.32%

0 bps

Brent Crude Oil (In USD per Barrel)

77.57

81.3

-4.59%

Primary & Secondary Corporate Bonds Data

Top 5 Secondary Retail Trades

Maturity

Yield

-

8.25% Muthoot Fincorp Ltd

3/4/2025

12.00%

8.1965% HDB Financial Services Ltd

30/5/2025

8.15%

9.6% Credit Access Grameen Ltd

23/11/2025

9.45%

10.20% Krazybee Services Pvt Ltd

19/12/2025

12.35%

9.7% Credit Access Grameen Ltd

7/9/2028

9.91%

Currency Market Data

Particulars

2/8/2024

26/7/2024

Change

USD/INR

83.791

83.724

0.08%

DXY

103.22

104.33

-1.06%

USD/ Brazil Real

5.74

5.69

0.88%

EUR/ USD

1.091

1.0856

0.50%

USD/CNY

7.1603

7.2511

-1.25%

USD/JPY

146.54

153.77

-4.70%

USD/ Russian Ruble

85.5017

86.1075

-0.70%