Yield curve softens amid forex market developments

By First Capital Research
Amid the rupee appreciation in the forex market, the secondary market yield curve shifted downward from the short to mid tenure amidst renewed buying interest, while market activity and trading volumes remained moderate.
Among the trades executed during the day, within the 2028 segment, the 15.02.2028 and 15.03.2028 maturities traded within the range of 10.00 percent to 10.10 percent, while the 01.07.2028 maturity traded at 10.25 percent. 
Meanwhile, the 15.12.2029 maturity changed hands at 10.40 percent. 
Further along the curve, the 01.07.2030 and 01.08.2030 maturities traded at 10.40 percent. 
Further along the curve, 01.10.2032, 01.06.2033, 15.06.2034 and 15.08.2036 maturities traded at 11.30 percent, 11.38 percent, 11.50 percent and 11.54 percent, respectively.
Overnight liquidity in the banking system contracted to Rs.141.27 billion, from Rs.158.93 billion recorded previously.