For government securities, the coupon is determined by the market. Potential buyers will indicate the quantities sought by them and the minimum yield they are prepared to accept.
The Reserve Bank of India’s decision to buy and sell government debt worth Rs 20,000 crore through open market operations brought the 10-year bond yield down on Tuesday but market participants are not convinced in how long
RBI is seeking to prevent wild swings in bond markets by agreeing to pay higher interest rates to investors at bond auctions, people with knowledge of the central bank's operations say.