Macro and Government Bond Commentary: Yields shoot up with global benchmarks, INR slips to fresh all-time low; liquidity deficit widens .10Y benchmark (7.10 GS 2034) opened higher at 6.83% tracking a sharp rise in treasury yields overnight (following stronger than expected US BLS nonfarm payrolls along with a drop in both unemployment and underemployment rates). Yields rose further during the day tracking a rapid depreciation in INR in sync with EM currencies as well as weakness in domestic equities. The INR slipped to a fresh life-time low of INR 86.57 (as at 3:30 pm IST). The 10Y point closed trade at 6.89% vs 6.80% (with the low beta correlation with US treasuries beginning to loosen). Moves higher in yields were also driven by a rise in crude oil prices.
