Indian bonds rally after auction size cut; rupee weaker on global dollar gains

MUMBAI: India's benchmark bond rallied on Tuesday morning as the government pared its auction size due to tight cash conditions, while the rupee dropped on the back of global dollar strength.

The benchmark 10-year bond yield dropped as much as 17 basis points to 8.29 percent.

The partially convertible rupee was trading at 66.55/56 per dollar at 9:13 a.m. (0343 GMT) compared with its close of 66.00/01 on Monday.

India will sell 100 billion rupees worth of bonds on Sept. 6, instead of the scheduled 150 billion rupees, the central bank said in a statement on Monday.