Strong demand at a recent Indian government bond auction has caused local traders to aggressively shorts, resulting in increased trading activity and a decline in bond yields, with the 7.26% 2032 bond yield ending at 7.1856%, its lowest since September. Foreign banks were said to have led demand, with anticipation the bond will eventually replace the current benchmark later in the year. That anticipatory sentiment appeared to run contrary to the hawkish tone adopted by the Reserve Bank of India.