India's benchmark 10-year bond yield drops to over 1-year low

MUMBAI: India's benchmark 10-year bond yield drops below 8.42 percent, the lowest level in more than a year, amid strong volumes on speculation that foreign banks have been buying actively in the market.

The yield was at 8.42 percent at 2:00 p.m. (0830 GMT) after hitting 8.4170 percent, its lowest since Sept. 18, 2013.

Speculation that limits for foreign investment in debt could be raised soon, also weighed.

Bonds worth nearly 421 billion rupees ($6.86 billion) had changed hands by 2:00 p.m., against a recent full-day average of 300 billion rupees ($4.88 billion), according to regulatory data.