Mumbai: India's government bond yields surged to their highest in more than three-and-a-half years to 7.39%, reflecting the direct impact of the central bank's liquidity-draining efforts and the indirect fallout of weekend measures aimed at bolstering the rupee.




Yield on the 10-year benchmark security, used to price mortgages, other retail loans and commercial advances, rose to its highest since March 2023, after having hit a high of 7.40% intraday, up from 7.30% Friday.



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The 10-year yield has surged more than 5%, or 38 basis points, over the past one month, investing.com data showed.



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The RBI will sell ₹25,000 crore of bonds through an OMO auction on Tuesday. On Friday, RBI raised the minimum daily cash reserve ratio maintenance requirement to 99% from 90%, effective mid-October. It followed it up with restrictions forward dollar purchases imposing a 20% cash reserve requirement on forex derivative contracts above $2 million.