Indian corporate bond yields fall

Indian corporate bond yields fell on Friday on hopes the central bank's buying of government bonds will help ease tight cash conditions, providing room for primary deals. The five-year benchmark corporate bond yield fell 4 basis points to 9.30 percent, while the 10-year bond fell 2 basis points to 9.21 percent.
"The liquidity support through OMOs will bring the borrowing cost down for corporates, prompting many firms to hit the market," a dealer with a foreign bank said. The Reserve Bank of India bought 88.2 billion rupees ($1.79 billion) of government bonds through an open market operation on Friday.
Banks borrowed 1.13 trillion rupees from the RBI's repo auction under liquidity adjustment facility on Friday, down from 1.20 trillion rupees on Thursday. The spread between the 10-year corporate bonds and government debt of the same maturity narrowed to 83.93 basis points from 88.68 basis points on Thursday. Total volume in the corporate bond market was 22.55 billion rupees.