Indian one-year swap rate higher on profit-taking

MUMBAI, Feb 9 - Indian short-tenure swaps edged higher on Tuesday, while rates at the long-end were little changed, as investors continued to booked profit, probably taking cues from higher equities, traders said.

Stronger equities suggest improved risk appetite and therefore, subdued interest in the bonds. At the same time, it could also signal increased possibility of monetary tightening.

"At around 4.90 percent, the one-year rate looked a little cheap today," said a trader at a French bank.

On the far end of the swaps curve, investors preferred 3-year rate to receive, which had risen to a 15-month high of 6.37 percent on Feb. 4. At that level, it was 26 basis points above a January 22 low of 6.11 percent.

At 4 p.m., the one-year OIS <INRAMONMI1Y=> was at 4.96/5.00 percent, up from its previous close of 4.91/93.

The three-year rate <INRAMONMI3Y=> was at 6.28/31 percent, just above 6.26/30 at Monday's close. It had fallen to 6.22 percent during the day.

Total volume in swaps was heavy at 67.85 billion rupees at the central bank's reporting platform.