Oversubscribed

The governments inaugural 10-year bond issue to one billion rupees was oversubscribed by nearly eight times on Friday.
The bonds carry an annual coupon of eight and a half percent and a nine percent yield.rn

rnHowever, at Fridays close, 5-year bonds were trading at 9.8 percent on the secondary market.rn

rnDealers expect yields to slip further in line with Central Banks policy of lowering short-term rates and ample liquidity in the market.rn

rnThe ten-year bonds are part of the governments plans to provide a longer risk free yield curve and getting out of the crunch created by the bunching of issues.rn

rnPublic debt department says it is also considering the issue of bonds with maturities of seven, eight and nine years during the course of the year.rn

rnBonds with maturities of over ten years are already on the cards.rn