Eerie March for bond bazaar as war shakes top issuers

government bond eased from Tuesday as the Reserve Bank of India (RBI) purchased government securities to inject liquidity. The 10-year yield ended Thursday at 6.66%.

Corporate bond yields, however, did not ease as much due to selling by corporate treasuries and redemption from mutual funds, traders said. The yield on Nabard's 10-year bonds, considered a benchmark in corporate debt, rose 6 basis points (bps) to 7.45-7.50% on Thursday.Global uncertainty has made both borrowers and investors cautious.

Nabard cancelled its plan to raise up to ₹8,000 crore through July 2029 bonds on Thursday, but later said it would re-try on Monday. REC partially cancelled its borrowing plan, scrapping its proposal to raise up to ₹3,000 crore via March 2028 bonds, but raised the same amount through a March 2031 issue, after receiving strong demand from the Employees Provident Fund Organisation (EPFO) at 7.19%, traders said.“The two-year paper of REC was pre-allocated, probably as long-term investors deployed cash, and the issuer also secured a reasonable rate as both sides’ interests matched,” a senior treasury official said.On 4 March, Small Industries Development Bank of India (Sidbi), among the frequent borrowers in India's debt market, withdrew its plans to raise up to ₹8,000 crore through bonds maturing in July 2029.

Earlier on 20 February, the National Bank for Financing Infrastructure and Development, also called as NaBFID, had cancelled the sale of the March 2029 bond issue of up to ₹5,000 crore because of high bids.Emails sent to Sidbi, Nabard, NaBFID, PFC and REC remained unanswered.International crude oil prices have been highly volatile this week as conflict flared in West Asia. On Monday, Brent crude surged past $100 a barrel,