States on Tuesday had to pay a higher price to bond investors as the weighted average cut-off rate jumped by a hefty 41 basis points to 7.24%. In the previous auction of State Development Loans (SDLs) last Tuesday, the cut-off was only 6.8%.
However, the weighted average cut-off for the 10-year state debt issuance hit a record 7.29% on Tuesday. This is 8 basis points (bps) higher than 7.21% seen last week and the spread between the 10-year G-secs yield and SDLs widened to 48 bps from 38 bps.
On Tuesday, the 10-year G-secs yield eased to 6.81% compared with the 6.83% last week.
