India's 10-year bond yield today hit a 2-month low on surprise open market operation by the Reserve Bank of India. Benchmark 10-year bond yield was trading at 7.73 per cent. The yield touched 7.7090 in the opening deals, lowest level since May 14.
RBI has said that it will buy Rs 10000 crore worth of bonds at an open market operation on July 19. Traders say this particular OMO purchase was not expected.
Drop in global crude oil prices also lifted the sentiment. Oil prices dropped after an industry group reported US crude inventories rose last week, defying analyst expectations for a significant reduction.
Traders will monitor movements in the rupee for further direction. The rupee was trading at 68.40/41 per dollar vs the previous close of 68.46/47.