The 6-week rally is thought to come to an end, concerning all market traders around. 

A panel on behalf of the Central Bank will be suggesting the government on the transfer of reserves during the coming month. Bond traders, who were unexpectedly pricing in around 3 trillion-rupee increase, were surprised at this decision.

 
Executive vice president for fixed-income at PNB Gilts in New Delhi, Vijay Sharma says that ‘Market players would be heading back to the drawing boards to re-work the budget math,’ adding that ‘Traders are jittery that the government may end up with higher borrowings, and if that happens, we may see more selloff.’

The Reserve Bank of India was assumed to increment its value resulting in a rally of bonds, with their price going down ever since October 2017. Hence, market traders now look forward to seeing whether the government will go beyond the 7.1 trillion rupees of borrowings, that was previously announced.

 
India’s benchmark 10-year depth incremented by two basis points to 6.87% on Tuesday, following the rise on Monday by seven basis points. The rise was a consequence of a delay in the panel’s recommendations, and may lead to a yield as high as 7.10%, according to Lakshmi Vilas Bank Ltd.