Debt market

Government bonds fell, with the benchmark note settling at a seven - week low, as a state debt auction attracted weaker - than - expected demand, while investors deferred purchases on lack of policy cues • The GoI benchmark 6.79 % 2027 bond yield rose to 6.54 % from 6.51% in the previous session • Yield on the US 10 - y ear increased to 2. 21 % from 2.18 % in the previous session.

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Forex (US$/INR)

The rupee ended little changed for a fifth straight session against the US$, as importers’ US$ demand offset gains triggered by strong equities • The US$ posted a recovery against major currencies as risk off sentiment subsided with the tax reform agenda coming in focus . Major currencies remain on an edge ahead of Annual Central banker’s Jackson Hole symposium this week. Japanese Yen could fall sharply if central banks signal towards tightening regime in the backdrop of the recent drop in inflation growth Equity • Equity benchmark.

Strategy In the currency futures market, the most traded dollar - rupee August contract on the NSE ended at 64.15. The August contract open interest declined 1.47 % from the previous day • September contract open interest increased 5.81 % in the previous session • We expect the US$ to meet supply pressure at higher levels. Utilise up side in the pair to go short on US$INR.