The RBI has pegged the cut-off yield of the paper at 11.90 per cent while the 2007 paper at a coupon of 13.05 is offering at an yield of 12.05 per cent in the secondary market. Though the RBI started selling the nine-year paper in the first week of June, it has so far not sold more than Rs 25 crore worth of the security. "The remaining is still with the central bank as there are no takers for this security as it is offered at a much higher price than that available in the secondary market," said a fund manager from a nationalised bank.

Currently, the RBI is facing difficulties in offloading its huge securities portfolio in the secondary market. "Currently, the central bank is selling the nine-year paper at Rs100.50, which is not in line with the market rate," said a dealer from a private bank. In the secondary market, the 2007 security is trading at Rs 105.45-105.60. On Tuesday, some trade took place in the 2007 security. "There is little demand for long-dated securities as the market is quite listless," the dealer said.

Meanwhile, the wholesale debt market of the NSE witnessed trading worth Rs 298.70 crore on Tuesday. The 13.55 per cent government loan maturing in 2001 was traded for Rs 85 crore at a weighted yield of 11.63 per cent. The 13.65 per cent government loan maturing in 1999 was traded for Rs 20 crore at a weighted yield of 10.22 per cent.