Mumbai, Aug. 27 -- The 10-year government bond yield fell another 8 basis points on Tuesday to hit a three-week low after the Reserve Bank of India said it will transfer Rs.1.76 lakh crore surplus to the government this fiscal, easing worries over the Centre's fiscal deficit target for this financial year.

The 10-year bond yield fell to 6.398% from its Monday's close of 6.48%. Bond yield and prices move in opposite direction.

"The fiscal math looks a lot more achievable following this transfer," said Emkay Research in a note to its investors.

The transfer includes Rs.1.23 lakh crore of surplus for 2018-19 and Rs.52,637 crore of excess provisions identified as per the revised Economic Capital Framework (ECF) adopted at the meeting, RBI sa...